Perhaps the key to answering this question lies in the title of a book published a couple of years ago: What Would Google Do? by Jeff Jarvis. What has Google done? What will they do in the future? To summarize the book-length answer, Google will do just about anything to become the “fastest growing company in history,” as Jarvis noted in the book. Google is no longer just a search engine. In fact, all the evidence points to the fact that Google hasn’t been just a search engine for a long time.
As you evaluate how to feel about Google’s direction, keep in mind that Jarvis’s correctly credits this massive Internet-based company with completely changing the way many businesses do business. In essence, many established companies and a whole lot of new companies are thriving with a new philosophy: Charge as little as possible to stay alive.
This flies in the face of the “old” business model of charging as much as the market will bear. Stated another way: Free is a good business model. Of course, consumers eventually pay, but the amount is smaller up front and continues over a long period of time.
All those great free tools come at a price
Google through the years has developed convenient products and tools, usually in the ‘free’ category: Google Analytics, Google Chrome, Google keyword research tools, Gmail , Google Alerts, Google Insights, Google Checkout, Chrome Operating System and Android (Google’s Cell Phone Operating System). The entire list can be found here. Most are free to the user, and profitable to Google. Since Google’s only source of revenue is advertising, you want the user to stay on your internet property for as long as possible, so it makes sense to offer users more and more opportunities to spend their time with you. Sounds like smart business to me. Google keeps us users happy by giving us faster, better, and free tools, dominating the market.
Google advertises these free tools using its own search engine, a search engine with an estimated 70% of US market share according to Hitwise. Is this really fair? Google putting their free products within the search results (typically in the #1 spot), when someone else offering that product has been paying Google for advertising all these years. In business, it is not a strong model to compete with your clients. But anyone competing with Google on one of these free products cannot afford to stop advertising with their new competitor, since Google controls most of the search market. They can’t survive without Google. They have no choice but to share the market with Google, once a portal now a competitor. Yes, this is capitalism, survival of the fittest. But longevity in business also includes keeping your clients happy, and I am not happy to give my money to someone that is now my competitor. The second I could make a move, I would do it.