Weapons Of Mass Distinction or How Apple dropped the Big One on Google


Googles Graveyard, just some of the apps , products and services Google has shuttered Google+ is now on life support. 

Google Businesses Killed


Hi Tech Buddies

Well another week and yet another announcement from Google about shutting down another previously touted service or product.

It seems Google has given up on its stated Dream to challenge Facebook with its Google+ application.

Link here for a well written Slate piece on the dearly departed.

Google’s failed effort to topple Facebook as a social media sight, and former scapegoat for other shuttered services an effort we were told that Larry Page was absolutely committed to and devoting all of Googles resources to. Once again people begin asking whats up with Google?

Why do they constanly cancel all these products and services ,  sometimes after committing fantastic advertising budgets to them, jumping out of airplanes and shifting employee’s lives around? Is Google just indifferent to the efforts of their developers,  indifferent to its loyal users who devote hours and hours of time and in some cases financial investment to these platforms, products and services only to be abandoned time and time again. Is Google as a company mindless, misguided, poorly managed? Do they not have a business plan?

I thought the answer to all these questions was obvious but I still see articles by tech journalist reportedly surprised when Google kills a product or Service. Whats up with them? Why are they all wasting talk and pencil lead pontificating about about Google’s “Noble” ambitions and strategy, is it just click bait or do they really not get it.

First lets say this one more time.

Google’s goal, business plan, whatever, is fundamentally  simple they are here to collect data in an effort to augment their advertising business by populating their analysis with highly relevant information. This effort is to convince companies (Googles Clients) that with Google’s advertising algorithms they will be able to reach highly receptive buyers in a convince, persuade or encourage them do buy their products. Google cancels or starves products or services that no longer provide them with useful date. Period

The rest is bullshit- Get it ?

Not that there his anything wrong with that mind you,  its roots go all the way back to the days of snake oil salesman and later to Mad Men and Don Draper.


Google achieves major disruption in the advertising business.

This major disruption is something I believe Google should be recognized, acknowledge and credited for. High margins are the reward for companies that disrupt. They are able to reap huge amounts of profits by not inheriting the fix costs or stagnant old manufacturing methods that companies of old used. Because Google’s medium affords them unbelievable profits they are able to spend their money in a unique way and this as it turns out is whats also ground breaking. Even Steve Jobs respected this effort by the young Google partners and early on counted them as allies in boosting Apple’s market share while chopping away at Microsofts pc business. In an effort to explain this in the correct light i would like to tell you a story from my own experience that I use to set the mind frame.

Here is a true story that I hope makes it a little clearer.

Along side my tech life I practiced residential real estate, owning a number of successful companies. Back a few years ago a company from England named Foxton crossed the pond and began to disrupt the Real Estate industry. Heres how : Foxton was a Mortgage company, in the US, mortgage companies are highly regulated (I Know) at least in the way they are allowed to advertise their interest rates. This makes it hard for companies to distinguish themselves from competition in a very lucrative business. So what does Foxton do, they apply for Real Estate brokerage licenses in a number of states NY & NJ included. Their brilliant but subtle plan was to become an online Real Estate company, hire single agents for huge territories and take full page ads in very visible newspapers. These agents would provide sellers with a lawn sign and help them complete the MLS forms, the sellers could call them for advice or to help them negotiate at the time of an offer but that was about the extent of their involvement. The key to getting these listings was offering a 2% commission at a time when the average commissions span was between the 4 to 6% range. This rate could potentially save Foxton clients in these regions thousands to tens of thousands in real estate commissions. One of the most important “Features” advertised by Foxton was that Foxton guaranteed to prequalify any buyer that called on their ad before letting potential buyers contact the sellers to arrange a showing. Genius, not only was the buyer able to save a hefty commissions but also only needed to show their homes to prequalified buyers, Great right? Well yes and no, of course everyone knows that it takes a lot more to get a house sold and Foxton was counting on most peoples misunderstanding of that process and their prejudice about paying realtors, but what is more important then the lo commissions which were in place to cover the expense of their salesman and advertising was the Mortgage leads they were getting from these buyers that were calling on these homes advertised by Foxton. Brilliant, Foxton gets to form relationships with demographic pinpoint accuracy with a whole slew of buyers for the same or less expenditure then monies spent hiring mortgage salespeople to scour the countryside trying get mortgages placed and paying for ineffective advertising. Their efforts failed and I won’t go into that here but I use this as and example of thinking out of the box to disrupt the current market place. 

Ok, Well , What does that have to do with Google?

Google is faced with this dilemma, In order for them to demand advertising dollar from corporations, they need to demonstrate that the data they collect helps them to pinpoint for the client the exact demographic the corporation targets as clients therefore saving money. More data equals better results making it critical for Google to accumulate all data from everywhere it can. The old model advertising Mad Men collected that data by developing surveys, studying and interpreted trends, relying on “Gifted” Don Draper types and mostly just pure luck. With the advent of the internet and Googles powerful algorithms the advertising business has become much more precisely focused streamlining the business. However to gather detailed data in this post 1984 Big Brother, 9/11  cyber crime era became problematic for Google. Not only could Google not simply go out and ask the public to truthfully fill out questionnaires detailing every aspect of their lives but obtaining information in that manner would not be as effective as Google obtaining those details and habits clandestinely, there by guaranteeing its empirical purity. The idea that Google came up with was to use the profits from their highly profitable business and instead of opening up fancy Madison Avenue offices with teams of “Ad Men” Don Draper style they decide to pay hipster software programers to develop consumer computer software for anything and everything the public used, word processors, photo databases, social networks , health vaults as well as many others and give them out for FREE. Google undertakes this route because they correctly predict that by giving away software, their users would gladly, sheepishly fill Google’s coffers with their otherwise private, protected data. Brilliant!! Google was now able to ubiquitously and I like to believe and trust, anonymously tract and monitor their users every keystroke web surfing habit providing Google and later the Feds (you did not think Google was given access to the militaries private airstrip and warehouse for nothing did you? see PBS Frontline’s United States of Secrets ) with this unprecedented amount of deep deep virgin data.

Road Block and BOOM!!

Things are going along smoothly if not a little boring in the tech world in the new millennium when in 2007 Along comes Apple and once again disrupts another industry, BOOM! this time their very own industry, they take computing off the desktop and place it into the hands of users, turning the computing world and later the entire world on its ear.

Soon after the 2007 launch of the iPhone Steve Jobs and Apple changed their strategy for the iPhone software development from web apps to a true SDK. In order for Apple to ” disrupt” the industry by separating the hardware from the carrier it was necessary for Apple to be in control of their destiny, something that Apple had built in to it’s DNA. With AT&T Apple found a willing partner. Prior to this network carriers would not let phone companies fiddle about with the phones software fearing that their entire network could be brought down by malware. In order for Apple to overcome this Apple provided a method of curating apps for any potential interference with the carriers network another disruption and once again BOOM!! alarms sounded through out Silicon Valley. Hail to the new King Apple and its Prince of Peace Steve Jobs !!!. With Apple’s newly found superpower Steve Jobs being Steve Jobs, that unapologetic child of the sixties steadfastly refuses to let Google or any company use Apple iPhone to suck Data from without the users express permission to do so. Remember, the Google apps included on the new phone for Maps, Youtube and Search were developed in conjunction with and by Apple and were not allowed to mine the data from Apple’s new baby. Hence Googles replacement apps for those products and services must now request permission from the user to do so in accordance with Apple’s policy for inclusion in the APP Store. This later becomes the reason for Google’s jettison from Apple’s native apps and Apple’s effort to create its own Maps app.

Google quickly realized that with Apple controlling mobile access it would damage their mining efforts, so they quickly scrambled to convert their feature phone Android software into an iPhone smart phone competitor, as well as begin to develop Chrome OS to counter Apple and Microsoft trend to offer desktop software curated through their own app stores.

When Steve railed on about Google being EVIL criticizing Google for not only abusing their fiduciary responsibility by using Eric Schmidt’s position on Apple’s Board as a insider to steal Apple’s technology and game plan and but also calling out as a company dealing in a “negative” vs a “positive” business model and violating Google’s mantra of “Do no Evil”.

Without data from mobile it became critical for Google to obtain their own user base in order to fill their coffers with data. They relied on their old tried and true strategy and added a few more twists, 1) outright acquisitions of tech software companies and their customers like Instagram, 2) continuing to develop freely distributed software for like Android, Chrome and 3) creating hardware products like Google Glass or buying hardware companies like Nest.

Google also realizes that analogies’ to more traditional natural resource mining, the mother load soon becomes exhausted requiring a new vein to be opened or to continue this mixed analogy they will need new blood to subtract data from. So like Dracula of old they are constantly on the prowl. This explains their lackluster support for products and services, reaping their data until they eventually see a need to kill the product and the reason for this whole discussion Goole drops products and services when they can no longer reap useful data from them. Period

From the first day of Apple’s declared thermo nuclear war on Google, Steve and Tim made have made it clear that one of their best weapons of mass distinction was Apple’s control of the hardware and software and that afforded Apple the ability to stand apart on quality and on privacy. This point of difference is paying off today as Tim drives it home in almost every interview , take his recent meeting with the German Prime Minister recently.

Today as more and more details are released through leaks like Snowden and Wikileaks privacy becomes more and more a hot topic, with governments spying on their citizens by taking advantage of direct hook ups (and I mean direct, like hard cables running right into their servers) to their data instead going through a more Democratic process of only honoring acceptable court orders to do so. This will only serve hi light the differences between Apple and Google and I believe to weaken Google’s position and force them into the Evil camp. Little by little as Google loses relevance they will soon become a target for disruption by companies that will settle for smaller margins or figure out a way to beat Google at their own game, unfortunately so far Google does not appear to have a alternative income stream to safely move. This position has left Google vulnerable to pressure to “cooperate” with agencies that may not have the best intentions, does anyone believe that Larry Page and Sergey Brin  tutored by Eric Schmidt pocess the backbones of a Steve Jobs to refuse this path. Sadly, I think not.  

Update 4/22/2015 – the gap widens see related stats click here