Google is always in the news and hence many business journalists are writing stories about them. I always enjoy reading the Google business story where the journalist applies traditional business logic to Google, when, in fact, much of what Google does is non-traditional and impossible to understand – even for them.
Let me give you an example… Google recently announced Android, their new effort to help mobile device manufacturers to create better phones that interact with the Internet & data services. From today’s NY Times, “What Google seems to be envisioning — apart from a greatly expanded market for ad sales, of course — is software for mobile devices that will be more flexible and innovative than most of us are used to seeing on our cellphones.”
Is Google really envisioning an expanded market for ad sales? I’d say, at best, they are HOPING for a new ad market. However, I claim they have no idea what the end benefit to their business or even end users is. People’s tolerance for advertising on mobile phones is VERY low.
Further, I claim that Google’s strategy with this endeavor and others like it is to shake very large, stale & uninnovative apple carts – changing the underlying fundamentals of incumbent businesses and HOPING when the dust settles, they can have a dominate role in the sector. With what seems to be an endless revenue stream generated by search ad sales and a stock price in the stratosphere – they certainly have enough treasure to shake apple carts, whether it be in TV/Radio ad sales, buying wireless spectrum or developing a mobile operating system.
Their insurance policy to make certain this benefits Google – hire sharp people. Google’s executives have realized that smart people, given enough time to be creative, imaginative and collaborative – change the world. Plus, all of Google’s endeavors strive to include non-Google third parties that might innovative by “thinking differently.” This includes people who Google can’t hire – like 15 year olds hacking it up.
Google’s dollars shake the cart, Google geniuses (and partners) quickly grab all the apples. Not a bad plan.