I just walked out of my entrepreneurship class thinking how Google can be defeated, in particular by Microsoft. I have no grudge against Google, but these are just simple thoughts which occasionally circulate in back of my mind to understand the business model of such companies, so I thought it would be interesting to share it with fellows and seek comments.
First let me explain why I chose Google versus Microsoft in my battle. Statistically, Google holds 50+% of market shares in search whereas Yahoo! holds 22+% and Microsoft 12-%. And these figures are relatively few weeks old. We see that Google and Yahoo! both are eating Microsoft’s stake in search marketing, but Google is a bigger competitor than Yahoo! to Microsoft for few reasons. The first reason is that Google is an advocate of Open Source software which is opposite of Microsoft’s principal, thus as long as Google is around, there is a potential and it is inevitable for some new product like Google OS or some easy to use version of Linux like Ubantu replacing Microsoft Windows. The second reason is that Google’s approach to product development is very software centric, meaning that all information and applications will be stored in massive data centers eliminating the user’s need for purchasing expensive Windows applications. And last but not least, Google opened a unit in Redmond, WA right next to Microsoft and is actively recruiting Microsoft employees. Moreover, Microsoft and Yahoo! are already having a contract over the vase service of instant messaging, providing users of both company’s messenger service to be able to send instant messages across both Yahoo! and Windows Live platforms., making them partially friends. Thus, we see that Google remains as the big competitor over the search market.
The Google’s money making machines, AdSense and AdWords, might be the best products of their own time to monetize users search and emails using text based advertisements, but it is a drawback for them being the only source of income for the company. Google has a wide range of services which are free, but the whole idea is to monetize that user’s usage of Google products by using the two major products states above. Having said so, Google makes almost 95% of its profit from advertising. The rest comes from the sales of Google Search Appliance and other gadgets or services which they are actually charging for. And now we discuss the plan to defeat Google.
It is very simple. I use this module in my Firefox called Adblock which blocks whatever advertisement material it finds on a webpage including those of Google’s Sponsored Links generated by their advertiser platform, but installing such module is voluntary. Now what Microsoft needs to do is to make a version of Adblock integrated with Windows and embed it into IE and Mozilla Firefox. This can be a separate module operating in the background working on Network Application Stack. Microsoft Windows holds more than 80% of the OS market share, so imagine what happens if Microsoft pushes this tool as a critical update to user’s machines and turns it on by default! Google will lose majority of its profit from its advertiser platform and eventually loses its cash flow and boom!
Explaining why I chose Microsoft and Google took longer than the resolution, but this shows how simple it could be to defeat Google. However, what remains questionable is that whether any regulation holds Microsoft from doing such thing, or it is simply unethical?
Please give me your feedback, as I want to know what you think about this idea.