Google, What's Everyone Complaining About?
from the on-top-for-now dept
One of the reasons that so many people fret about broadband penetration is the assumption that it's somehow related to innovation and economic performance. And it's always set up as a horse race, so people talk about this or that country "falling behind" others. And yet for all of the concern about the state of broadband in the US, American internet companies are doing pretty well on a global level. In fact, it's not even close. Of the 30 most popular internet destination, 25 are owned by American companies. Of course, some concerned about whether the US is too powerful on the web, and once again, people are wondering whether the strength of Google is something that warrants regulatory attention. This question has been bandied about before, but it's still hard to see on what grounds a complaint could be made. Are there high switching costs associated with using search engines that Google is unfairly exploiting? Is it preventing other companies from entering its industry? The only reasonable complaints it seems are that the company is too big, too profitable and (from the perspective of the rest of the world) too American, none of which is illegal, even under EU law. If anyone thinks that the company can unfairly parlay its strength in search into other business, just look at the YouTube deal. It had to pay $1.6 billion to buy the company, because its own identical product was going nowhere. Think there won't be plenty more startups that come to dominate an area that Google would like to get into? Fat chance. None of the complaints about Google or other US internet companies make much sense. People around the world flock to Google because they like it and get benefit from it that they don't get from other sites, otherwise they wouldn't use it. Trying to change this because it's growing too powerful, or some misplaced fear about falling behind in the transatlantic economic rivalry, will ultimately only hurt users.
Thank you for reading this Techdirt post. With so many things competing for everyone’s attention these days, we really appreciate you giving us your time. We work hard every day to put quality content out there for our community.
Techdirt is one of the few remaining truly independent media outlets. We do not have a giant corporation behind us, and we rely heavily on our community to support us, in an age when advertisers are increasingly uninterested in sponsoring small, independent sites — especially a site like ours that is unwilling to pull punches in its reporting and analysis.
While other websites have resorted to paywalls, registration requirements, and increasingly annoying/intrusive advertising, we have always kept Techdirt open and available to anyone. But in order to continue doing so, we need your support. We offer a variety of ways for our readers to support us, from direct donations to special subscriptions and cool merchandise — and every little bit helps. Thank you.
–The Techdirt Team
Reader Comments
Subscribe: RSS
View by: Time | Thread
Then advertise through American web sites
http://www.youtube.com/watch?v=Tak9UmQRkww
[ link to this | view in thread ]
Oh, and don't forget India
http://www.youtube.com/watch?v=kCiviB9BDVk
[ link to this | view in thread ]
anywho..
blog makes a a good point. everyone is treating google like some kind of evil monopoly (while ignoring evil monopolies)
all they are doing is providing a service users like.
[ link to this | view in thread ]
Dorpus...
Now leave all the big kids alone and go find a tall building to test it from.
BACK TO THE TOPIC -
Everyone is bitching about Google again. I don't see why either. No one has lost any choices as a result of Google offering its services.
The only thing I'm afraid of is that Google's going to pull a Yahoo and "overdiversify" themselves into extinction.
[ link to this | view in thread ]
Luving Google
[ link to this | view in thread ]
What the...?
It seems to me that people are (more than anything else) worried that google might be another enron. Yet millions - no, billions - of searches are done by google every day, and at least 1% of those generate income for google. Let's disect this a little further. If we presume that google gets 1 billion searches a day and 1% of them get 1 ad clicked, that comes to...1 million ads clicked. Now, if we assume that (since those ads are on google's own site, and therefore google isn't paying any back out in AdWords) they're making a quarter off of each click, that's 250,000 bucks a day. Let me say that again - if they got half the searches they did with one fifth of the actual ad clicks they get only on their own site, they'd make a quarter of a million dollars every day in income. Now, after you scale this up to 2 billion searches (or possibly more), 5% ad clicks, and then figure in all the ads they have on other sites - possibly trillions of ads a day, most with a 5% clickthrough - then google is easily clearing 50 million a day in income bare minimum. Now I agree, all these are vague numbers, but it's safe to say that google makes the $1.6 billion it used to buy youtube in about 2 or 3 weeks. Considering that, and considering the fact that aquisition of services such as youtube (and the "diet coke and mentos" video ads deal they've signed since then) which make even more money means google is well in the black in their accounting. In fact, they're probably in the yellow, or whatever the RGB opposite of red is.
So I would say that google is in no danger of becoming another enron story, because if nothing else, they've got more money than the entire holy trinity combined - just in income. Unless google either collapses entirely or begins to charge for some of their services (such as them charging for the new Docs & Spreadsheets, god forbid) there's nothing for people to worry about, and let's face it - they're not going to collapse unless all 4 (or however-many) of their datacenters get nuked overnight, or else unless they get greedy and decide that making over 50 mil per day isn't enough - which they won't do. Right now, without their ad money, google goes broke, and a PR nightmare such as charging people for a service after they've been using it for free in beta (especially without giving people a chance to get their documents saved offline first, which I've seen other companies do with email) would take that ad revenue through the floor. Google may be a bunch of rich people now (and possibly a bunch of greedy people, though 2 and soon to be 3 gigs of email space seems pretty non-greedy to me) but they understand that the most important asset google has is its image. The main homepage says it all - a small, basic text box and a logo that contains more power to find things than anything else on the web. That's the only thing google has now that sets them apart from Yahoo and MSN, and I promise you that if their main homepage suddenly became cluttered with stuff nobody liked, they'd lose 10% market share in 24 hours. Simplicity is a virtue, and google knows that keeping to that virtue is what's got them this far. They won't do anything to break away from that virtue, nor from their entire general persona of virtuousness. Google lives by their "white knight" image, and if they die off, they'll die by it, because they are the one company out there who knows what people want, and gives it to them.
[ link to this | view in thread ]
That is a free market people, without such there would be no America as we know it today(the good parts) and The EU would have never gotten out of the industrial revolution.
[ link to this | view in thread ]
[ link to this | view in thread ]