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Google destroying competitors

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italiandragon

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I Gooooooooooooogle , order you to surrender your biz because your wasting your time anyway since I will take over you soon or later...

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Google shows how to trash a business model or three

COMMENT BY STEPHEN HUTCHEON

January 6, 2010 - 2:33 PM


Google ... another small step towards world domination. Photo: Phil Carrick
Today's launch of the Nexus One, the Googlephone, is the latest move by a company bent on world domination.

Google has become the archetypal smiling assassin, a corporate goody two shoes which can't stop itself from steamrolling all who stand in its way.

And with its ever expanding portfolio of interests, it's becoming increasingly difficult to dodge the cross-hairs.

It's not just the new phone (and the browser, the free email, the maps, web video, word processor etc). You may even soon find Google DNA in the controls of your washing machine and microwave oven.

San Francisco-based Touch Revolution will be exhibiting prototypes of its "kitchen command centre" at this week's Consumer Electronic Show in Las Vegas. Their devices will be powered by a modified version of Google's Android operating system - the same software behind the Nexus.

We should admire organisations and individuals that challenge conventional wisdom and discover a better way of doing something. It keeps everyone on their toes.

Google's team includes some of the best and the brightest. The products and services which do the damage are conceptually brilliant and useful. And it's all done without the slightest hint of malice or avarice.

The irony is that many of those companies which have or are about to find themselves rubbing shoulders with polar bears on the endangered species list, were once or still are doing business with Google.

That's what frenemies are for.

Look at the potential collateral damage from today's launch of the Nexus One. Spot those companies or industries which suddenly find themselves at the wrong end of a mutually beneficial partnership.

1) Mobile phone handset makers and platform providers such as Apple, Microsoft, BlackBerry, Nokia, and Motorola

First Google rolled out the Android platform allowing any handset manufacturer to wrap their plastic around it. Now Google is becoming a retailer and going into direct competition with those partners.

Even Apple now finds itself in those cross-hairs, facing stiff competition from a device to rival the iPhone, currently the crown jewel in its inventory.

Until mid-way through last year, Google CEO Eric Schmidt sat on the Apple board and the two companies appeared to share a common vision and a mutual admiration.

That all changed when the Google Voice app - which strayed into the business of Apple's telco partner - was rejected for inclusion in Apple's iPhone App Store.

Now its handsets at 40 paces with Google appropriating the slot on the calendar which for the past decade has been used by Apple to showcase its latest must-have gadget or upgrade.

The first reviews suggest that the Nexus might not have enough in the tank to halt the iPhone's mesmeric growth, but with each platform upgrade, Android is edging a little closer.

However, with its open architecture, unregulated app store, removable battery, expandable memory, the Nexus makes the iPhone's walled garden model increasingly look like the work of control freaks.

2) Then there's the GPS navigation industry. On the iPhone you pay between $100 and $70 for an app that turns your phone into a functioning GPS sat-nav unit. Or you can buy a stand-alone unit for anything from $100-plus to around $400. On the Nexus, they're handing it out for free.

Google and TomTom, the world's leading GPS navigation, have worked together in the past. Now TomTom and Garmin and any other sat-nav business finds its business model in ruins.

When Google first announced plans to offer a free turn-by-turn navigation system on phones running its latest Android operating system in October, TomTom's share tanked by 29 per cent and Garmin's slumped by 16 per cent.

3) Finally, there's the telecommunication carriers themselves. Their fear of being turned into "dump pipes" is starting to be realised.

Google's new Phone Webstore gives the company a direct retail link to its potential customers, allowing them to (almost) bypass the telcos.

And the way Google is talking suggests that this is not a one-off: "As new phones come to market through this channel, consumers will benefit from the ability to match a phone of their choice with the service plan that best meets their needs," according to Google's Nexus press release.

Selling unlocked phones allows consumers to avoid being trapped in contracts. That means if you don't like the service or someone has a better deal, you just take your phone and jump ship, without penalty.

Today's launch is about much more than another snazzy handset. Mark it down as the first big move of the decade in the mobile web sphere from the masters of business disruption.
 

sashas

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here's what's happening: Google realizes that 97% of its revenues come from AdWords. That's too much dependence on one single product. Its trying very hard to diversify its sources of revenue. Hence the Nexus One, Google Voice, etc.

I'm pretty sure no other big company in the world derives 97% of its $25 Bn+ revenues off one product...
 
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