Wednesday, April 10, 2013

Google... What is next?


Google's unique asset is the capability to manage millions of databases. More precisely, Google has a platform of 235 millions active users, including those who use other Goggle products such as Gmail, Youtube and maps among others (6). Google's aggressive strategy has already sowed the seeds of success. The development of a search engine to a giant in the technology industry, shows that the strategy team of Google, has achieved significant accomplishments. 

Although Google's presence in the whole tech industry is ubiquitous, there have been also some strategic fallacies. The most sound of them that caused Google to drew back from this lucrative investments (did not last much since Google came back with Google+) would definitely be the social media strategy through Google Buzz. The failure to attract users in this platform, while Facebook and Twitter were thriving, has demonstrated that there is no room for Google's development in social media industry (7). In market development cases, when starting from scratch fails, there are two available options: either to acquire an existing player or to form a joint venture/strategic alliance with an existing player, by examining thoroughly the competition, the market shares and the barriers to entry among others. 


Google announced few days ago its intention to be an Internet Service Providers (ISP), by installing fibers that could provide one-gigabit service, which is about 100 times faster than speeds available from any other service provider along US. But How Google will proceed is still unpredictable. Thus, in contrast with market development in social media, Google's openness as an Internet Services provider is a gambit. This strategy has already created increasing concerns to the existing players. Google's capability to provide high-speed Internet in selected communities, has many benefits not only to communities by creating more jobs and facilitates the citizens with high-end Internet services (3), but also to the Google itself, by acquiring a significant market share. This over promising application of Gigabyte Internet, in Kansas City, has created expectation for Google Officials. Although, in Kansas there where many hurdles, such as local approval, selection of local neighborhoods and construction phase, these implications have created an irrational tardiness in the fiber construction (fall 2013). 

The millstones from Kansas experience, Google wants to avoid them, as soon as possible. According to the media, Google will announce the Fiber in Austin, an ideal location where other tech companies have important presence there (1). Google's selection of big-experiment cities, is an issue of discussion. To think another project of Google in Internet Services is the free wi-fi in New York City, close to the second largest of Google's offices (Googleplex East). If everything goes well in fiber's project, maybe New York City will be the next experiment city (5). But it is very crucial to understand the resonance of Fiber project in Austin, because the speed by Google Fiber alongside with the pay-tv Service will reform the competitive map of the industry. Google giant is likely to be the relegator of the "Big Game" in internet services. 

The added value of Google's fiber to the citizens of Austin and the next cities will be invaluable, given the fact the price of these services and the financial motivations. If Giga upload and download internet services go hand in hand with pay-tv services, the households would have lofty services in their asset. Thus, fees ($300 approximately) are nothing next to the project that will change the status quo of a community (4). 

The itinerant strategic endeavors of Google market development are likely to prove that is actually worth both the time and costs. Google by trying to catch and lock this market  is close to being the major hyperplayer in the whole Internet Service Providers industry as well; and by leading the Fiber project, which has potential to succeed, and then all the other competitors have to struggle to jump in on this new technological milieu.


Sources:

No comments:

Post a Comment

Note: Only a member of this blog may post a comment.