Google’s Vulnerabilities

News.com has a commentary by Forrester’s Charlene Li:

Google will have a hard time fulfilling its mission to “organize the world’s information and make it universally accessible and useful,” as competitors like Microsoft and Yahoo rev their search engines. This is because in its current incarnation, Google:

– Doesn’t provide as much value as portals.
– Tries to stretch a simple search box to fit all queries.
– Has few advantages when it comes to specialized search.
– Must invest heavily to stay out in front.

Forrester believes the company will be hard-pressed to live up to its highly anticipated IPO. This is because Google will have to fight three fronts in the upcoming search war–and will likely succeed at only one. In these three battles:

  • Microsoft will win in integrating structured, desktop search. In its next version of Windows–due out in late 2005–Microsoft will revamp desktop search by turning the existing file system into a database.

  • Yahoo will excel in creating the portal experience. Even if Google can overcome a deep-seated cultural focus on search, it lacks the experience to compete against the three portals.

  • Google’s forte and fortune will be locking in advertisers–and publishers. Google will become the dominant pay-for-performance ad network because it will deliver the biggest and best audience through its network of publishers.

  • John Battele differs:

    Here’s where I think this analysis misses a few key points. One, Google is already a portal, but a loosely joined one. It has Orkut, Groups, Blogger, and – rumored to be coming soon – email (well, they already have email – it’s in Orkut). If for some reason they have to move in that direction to compete, they can and they will.

    Second, Li bases much of her analysis on the interface presumption that Google will always take the “blank slate” approach to search – that is, the user comes to a blank box, with no context to guide the search results. While this is true now, it need not be in the future. Page was recently quoted saying “it takes five seconds to type in a zip code” – and I am sure the folks at Google can figure out a way to make sure that zip code (and any other personalized information) only has to be typed in once. In other words, if Google feels compelled to add personalization, they will (and if you’re an Orkut member, my guess is you’ll be able to personalize your search pretty darn soon).

    And lastly, Li assume that publishers will prefer Google over the portals, because the portals are competitive with publishers. In fact, publishers will go with whoever sends them profitable traffic, end of story. If Yahoo or AOL can do that, the publishers will work with them.

    Marketing and Influencers

    John Battelle writes: “Influencers are critical to business success. But the last thing you want to do is treat them like a mass market. Instead, do the hard work of cultivating them in a personal network.”

    how do you find your own influencers? In the entertainment business, for example, they’d include the obvious elite — media critics and senior executives in the business, but also well-respected reviewers on Amazon (AMZN), crossover voices like Wil Wheaton (a sometime actor who now has a wildly popular weblog), and outspoken critics of Hollywood. In technology, your influencers would include large corporate customers, industry analysts and journalists, selected policy wonks, and a sampling of early adopters — the folks who eagerly try out new technology.

    Instead of hiding behind marketing programs, make it your business to create a personal network. Identify the communities that consume or champion your product, as well as the controversies (like the health value of hot cereal, for example). Then start talking to people. Don’t try to sell them anything, just ask for input. Most people like being asked for their opinions, particularly if their ideas affect how the product is made. Include critics — if you can learn why they dislike your product, and integrate their input, they may become your greatest champions. Over time, this network will start to spread positive word of mouth, and good things will happen.

    The act of maintaining a network of influencers may not come naturally, but if you don’t already have one, you’re out of touch with the very people determining your success. Get out and meet them — it’s a lot cheaper than a Super Bowl ad and, I’d wager, a lot more effective.

    Blogs can be a powerful way to market and build influence.

    Information Lifecycle Management

    The Economist writes that data storage is booming:

    EMC reckons that the surge in demand is so huge that the situation calls for one of the industry’s periodic technological revolutions. During the industry’s stone age, back in the 1980s, firms stored their data much as consumers with desktop computers still do todayon the same machines that also processed it. The next paradigm shift, sometime around 1990, was to split the two functions, using a model called direct-attached storage (DAS), in which each computer is attached to a separate storage arrayin essence, a cabinet full of hard disks. If one or the other breaks, you can repair it without taking down the entire data-storage edifice.

    DAS still accounts for about 70% of all data stored today. But it is already becoming pass. That is because, in the late 1990s, EMC came up with a bright idea. Companies could use their storage capacity more efficiently by creating internal networks that connect a bunch of computers on one side with a cluster of storage arrays on the other. Stephen Chin, an analyst at UBS, an investment bank, reckons that such storage-area networks (SANs) can boost the utilisation rate of hardware to as much as 80%, from about 20% in the one-array-per-computer world of DAS.

    EMC’s boffins have now come up with a new idea: storage networks are great, but they still fall short in this brave new world of red tape by treating all information as the same, when blatantly it is not. There are this quarter’s profit numbers, and then there are the payroll figures for that receptionist who was laid off ten years ago. The former is clearly more valuable, and deserves costlier technology, than the latter. Technology buyers, with today’s tight budgets, want systems that do not overcharge for storing all the junk.

    EMC’s answer is Information Lifecycle Management, or ILM. This is a souped-up and smarter version of a SAN. Now, servers are attached not only to one cluster of arrays, but to several different classes of storage devices, some top-notch and fancy, others cheaper and more dated. Special software moves data between these devices. New profit data end up in the fancy machine, for instance, while last year’s profit numbers get moved down a tier. As for that receptionist’s old wage slips, they go to an archive tape. And so on.

    ILM explains why EMC has bought Legato, Documentum, VMware, and several other firms over the past year. All of these firms have technologies that EMC needs to deliver this new way of storing data. If things go well and EMC has a winner, the main thanks, of course, go to the politicians in Washington, who are proving so helpful to the industry even without any lobbying. Whether all of these extra data will ever be of much use to anybody remains to be seen.

    Smartphones

    Walter Mossberg compares European and American smartphones after a visit to the 3GSM World Congress:

    The European cellphone industry is preparing for the widespread rollout later this year of so-called 3G phone networks, which will supposedly operate at broadband speeds. And the carriers and phone makers there were showing off various services they hope to sell over these networks.

    Yet there is one aspect of wireless communications that the Europeans and Asians don’t do as well as the North Americans — the melding of a phone, an organizer and serious e-mail capabilities in a small, portable device.

    U.S. and Canadian companies have produced two fine high-end smart phones that are also great e-mail devices: the Treo 600, from PalmOne, and the BlackBerry, from Research in Motion. A third combo gadget, the Danger Sidekick sold by T-Mobile, is also an excellent portable e-mail device, but it’s too clumsy as a phone.

    Two qualities characterize all three of these e-mail devices. They all have miniature keyboards, so you can quickly write e-mails. And they all have sophisticated e-mail software, with rich options for managing your messages.

    Probably the best European smart phone is the Sony Ericsson P900, which became available in the U.S. last month. I have been testing the P900 over the past few days, and comparing it both to its predecessor, the P800, and to the Treo 600.

    My conclusion is that the P900 is significantly better than its predecessor, and beats the Treo in a number of key respects. But, when it comes to serious e-mail handling, it doesn’t measure up to either the Treo or the BlackBerry. It doesn’t have a keyboard and its e-mail software isn’t sophisticated enough.

    Globalisation 3.0

    Yet another gem by Thomas Friedman, who has been visiting Bangalore:

    The first era [of globalization], from the late 1800’s to World War I, was driven by falling transportation costs, thanks to the steamship and the railroad. That was Globalization 1.0, and it shrank the world from a size large to a size medium. The second big era, Globalization 2.0, lasted from the 1980’s to 2000, was based on falling telecom costs and the PC, and shrank the world from a size medium to a size small. Now we’ve entered Globalization 3.0, and it is shrinking the world from size small to a size tiny. That’s what this outsourcing of white-collar jobs is telling us and it is going to require some wrenching adjustments for workers and political systems.

    Globalization 3.0 was produced by three forces: First is the massive installation of undersea fiber-optic cable and bandwidth (thanks to the dot-com bubble) that have made it possible to globally transmit and store huge amounts of data for almost nothing. Second is the diffusion of PC’s around the world. And third (what I missed most) is the convergence of a variety of software applications from e-mail, to Google, to Microsoft Office, to specially designed outsourcing programs that, when combined with all those PC’s and bandwidth, made it possible to create global “work-flow platforms.”

    These work-flow platforms can chop up any service job accounting, radiology, consulting, software engineering into different functions and then, thanks to scanning and digitization, outsource each function to teams of skilled knowledge workers around the globe, based on which team can do each function with the highest skill at the lowest price. Then the project is reassembled back at headquarters into a finished product.

    Thanks to this new work-flow network, knowledge workers anywhere in the world can contribute their talents more than ever before, spurring innovation and productivity. But these same knowledge workers will be under more pressure than ever to constantly upgrade their skills in this Darwinian environment.

    TECH TALK: As India Develops: The Opportunities

    Indias development opens up many opportunities. Here, I will focus on seven key areas that entrepreneurs can seek to target in the coming years. While some of these ideas may be specific to the urban or rural context, others can work across both. The two things common to all of them are that they require much less capital than the build-out of core infrastructure, and they need new, innovative ideas. If we can make these ideas work in India, we could also translate them to many of the other emerging markets as they develop.

    1. Education: Education is perhaps the most important investment that people can make in their future. Despite all the government efforts, universal availability of quality primary and secondary education is still far from reality. In many areas in rural India, there are schools but no teachers. In addition, there is a need for vocational education for adults along with specific training as they migrate to the production sector from agriculture.

    2. Microfinance: Along with education, the lack of finance is one of the biggest inhibitors for getting people out of poverty. One of the ways to address the credit constraint is microfinancing. Grameen Bank of Bangladesh is one of the best examples of a profitable organisation providing credit to rural people.

    3. Market Access: There is a need for information marketplaces (or exchanges) to connect buyers and sellers, which can help the producers get the best value for what they make. This is as true for artisans as it is for small- and medium-sized enterprises (SMEs).

    4. Information Access: The Internet has effectively bridged the information gap for many of us in urban India. Yet, the same information that we take so much for granted is not available easily to the rural populace. It could be about techniques for better agriculture or about healthcare or near-real-time information about the weather, made available in the local language.

    5. ICT: Information and Communication Technologies are the platform on which many of the solutions for providing services can be architected. The key is to create affordable solutions which bring down the price points to levels which todays non-consumers can pay.

    6. Energy: Power is still one of the biggest bugbears as part of the infrastructure in both urban and rural India. Innovations like fuel cells are making possible micropower which bypass the need for the availability of the grid.

    7. Distribution Hubs: Products and services need to be made available to both rural India and SMEs. One of the ways to make them affordable is to create hubs for availability and distribution. Two such platforms are RISC (Rural Infrastructure and Services Commons) and the Tech 7-11 in urban and semi-urban India.

    Next Week: As India Develops (continued)

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