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Google: The King of Disruptive Technology

January 29, 2010 Posted In: Google Comments: 4

This is a guest post by Terry Van Horne. Terry is the founder of SeoPros and a 15-year veteran of Web development, currently working out of his consulting and development firm International Website Builders. Terry's interests are primarily the socialization of search and analysis of social Web traffic and applications like Twitter.

I discovered the term "disruptive technology" while dabbling in day trading. Basically it's a technology or business that enters a space and disrupts the current sales and business model -- these days, almost always using technology as a catalyst. I actually did some trading in these stocks, and here's a tip: When it seems the price is stupid ... it is!

The Interwebs have proven be a very disruptive technology. The Web changed the travel industry, in fact, knocked it on its backside -- driving the costs for travelers down and almost entirely removing the "travel agency" from the model.

Currently another biz model is facing a pretty rough row to hoe. Newspapers are facing a "perfect storm" with advertisers moving to the Internet, in particular search, and to a lesser extent social media and social networking sites. Traditional media like television (a story in and of itself), radio and newspapers are watching the Internet take market share away, to the point that some are putting paywalls back up.

Free dailies are taking box revenue and subscribers from the newspapers. I used to buy a newspaper to read on the subway. Not anymore -- I just grab the Metro (a local Toronto daily that just announced a deal with Foursquare), and I get the real news on the Web.

Over the years, as the Internet has become ingrained into the fabric of society, it's natural that it become the central distribution system for news. Now AP (the Associated Press) has possibly left/been dropped from Google ... the plot thickens.

Any industry that depends on lead generation is increasingly dependent on the Internet. IMO, that will gain velocity with ubiquitous connectivity just around the corner. Google's disruptive technology in the lead generating biz is brought to you by Caffeine and the horsepower it provides to gather leads right in the AdWords ad! For the content network, this becomes a very interesting prospect for PPA over other click-based pricing.

The contextual network becomes just a little more interesting to advertisers in that scenario, doesn't it? This provides an ad service no other vendor can provide ... yet. Disruptive? I'll bet the people in Redmond think so. I understand Bing could do this with its "no click" search but AFAIK they haven't announced anything.

For developers like myself, Google just took $'s right out of my pocket! Won't be long before they will be looking to cut SEM's out of ad management as well. Simply, Google will not stop until it owns a vertical end-to-end, that's the way disruptive technology is supposed to work. They bought Urchin, the only major competition in the free analytics space, supplying another piece of the end-to-end domination of paid search.

"No-click search" would be an SEO killer. You never leave "The Gorg" collective. I wake up in a cold sweat whenever I dream about it. So the Gorg has newspapers begging for mercy, it owns Internet and video search, so where is it going next? Well, mobile of course! Resistance is futile!

brent payne tweetsEnter Nexus One. The phone isn't that disruptive, but as @BrentdPayne pointed out, the direct sales method using commerce search or another system is potentially a major game changer in the e-commerce world. Woot! I must be prescient -- I got out of the conventional cart biz in 2008.

The mobile market is one I don't think can be disrupted unless you do it with free data plans and phones. What no one in mobile wants to discuss is how it is so much a texting medium that Twitter or a Twitter-like app could potentially do better than mobile search.

I said it in the early days of mobile and I'll say it again: Given a choice, people will always surf on the desktop, using phones only when they are trying to locate a location. The exception, possibly, is Asia, where desktop internet services are in the same predicament as mobile data plans in North America, i.e., no one will pay the exorbitant fees. NA Telcos? They are basically addicted to the public teat (in Canada at least) that government provides so they wouldn't think of dropping prices!

Knowing the Gorg, they will try, realize ads can't support it profitably and exit! Just like they did with print advertising. But to make up for that they will partner with "big box" stores and replace that biz with the "no-click e-commerce network." $50,000 to play and you get all the customer headaches! Yeah ... the Interwebs ... complete assimilation? Naw, but IMO, it does change it, for me professionally at the very least!

The good news is Google's disruptive technology strategies don't always succeed. To be truly disruptive the product must be used, and Google Docs, Chrome OS and other products meant to disrupt Office and the Windows OS have been, for the most part, failures, with the exception of Gmail. The Chrome browser has a shot, but with browser wars it's pretty hard to see the outcome ... until it's happened.

I don't know for sure but I don't think they are going to be successful in the cloud either. Simply, biz will be wary of a cloud where customer service isn't instant and low-cost. Second, there's the risk, because public companies can't really be dependent on the Interwebs. Document storage has a good shot, however, crucial business software in the cloud makes no sense.

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Comments

Tuesday February 02, 2010

Barry Dennis (not verified) Said:

What happens when your AI on your Convergence Appliance uses empirical results to solve your "question?" How will you know that your Curiosity Quotient has been fairly and accurately satisfied; that you have credible results you can trust and rely on?
"Cheapest glass of Chateau LaFitte at closest store is at Hobby's on Wino Street."
What happens when the idiot newspapers current business model proves that they lost one of the greatest business opportunities in modern business history?
What happens when your Content choices are limited or "managed" by the monopolistic practices of Cable and Telco (and soon Wireless)? Not only that they charge MORE.. for LESS.
"Is that what is troubling you, buddy?"

Wednesday February 03, 2010

Anonymous (not verified) Said:

Hi,

Great article. This has been happening for quite some time .

The difference between the travel industry analogy and search engines (aka google) is that no one company had, or still has a monopoly within that industry. The model simply changed.

In the case of Google, it is clearly one company entering into these industries, changing the model and following the current mantra:

1) Provide services for free that were previously paid for (or the business itself made money from ad revenue) - analytics, thereby devaluing the industry as a whole
2) Give your own businesses premium position in your search engine - e.g. all other video sites vs youtube
3) Use your engine to provide yourself free advertising, whereas everyone else has to pay - e.g. adwords/adsense
4) Flood the market with your own ads - e.g. nexus one taking adwords impressions away from other advertisers, showing through adsense on sites where nexus one is not relevant to the site

Quite unbelievable really. Im not sure why if theyre getting away with all this now, that they dont just buy all the websites on the internet. Then it would be game over. However, that wouldnt be much fun would it? There would be no more internet businesses to compete with!

TBH Im all for a non-profit search engine - pls pls pls Tim Berners Lee create one - We trust you!

Wednesday February 03, 2010

Jason (not verified) Said:

Aren't you a little premature saying that Chrome OS is a failure... when it hasn't even launched yet? Throwing out things that have no possible factual basis like that destroy any trust that the rest of the article might have built, at least for anyone who knows it's false.

Monday March 01, 2010

Anonymous (not verified) Said:

Do you mind if I slightly re-quote you - as I think you may be partially right ...

"I'll say it again: Given a choice, people [of my age] will always surf on the desktop, using phones only when they are trying to locate a location."

oh, I nearly forgot, one more ...

"crucial business software in the cloud makes no sense [to someone that does not understand it]"

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