The Portal Problem: will Google repeat Yahoo's mistakes?
Those who cannot remember the past are condemned to repeat it.
You've probably heard that one before. It's a quote from George Santayana, usually dusted off for political debates of some sort. Lately though, I've been thinking of it in reference to tech companies - particularly Google and Yahoo. Google eclipsed Yahoo more than 10 years ago and never looked back. But could that very act of never looking back be leading them straight off a cliff?
Google vs. Yahoo (and other) search market share. From the Motley Fool.
Let's back up. A while back many of us read the New York Times article What Happened When Marissa Mayer Tried to Be Steve Jobs, by Nicholas Carlson. I already wrote some initial thoughts on that, so I won't go in depth here. Suffice it to say, Carlson takes us on a journey through what Yahoo did right and what Yahoo did wrong though the years. The most interesting part, I believe, is how Yahoo fell from grace. My summary from last time was as follows:
[Everything] changed when other companies improved on different parts of [Yahoo's] offering. Suddenly you could get better search and mail over at Google, better news over at CNN.com, better social over at Facebook, etc. Yahoo had become a jack of all trades, master of none, and their business was suffering for it.
This was a strategic mishap, and strategy (in theory!) is simple. You choose a thing to work on, adjust your product until the market is on board, and profit. As time goes on you might expand your product offerings into other areas that complement (fit) your place in the market, but you also choose what not to do (tradeoffs). In the early days of the Internet, Yahoo's product/strategy made sense. Organize the net, make it accessible to the layman, reap ad profit. But as the Internet grew bigger and more complex, this was never sustainable. They should have tightened up their strategic offering, focusing their energy on maintaining dominant services in a few key areas, and letting others fall by the wayside. But this didn't happen, and Yahoo was pulled apart piece by piece as various companies unbundled their offerings and improved on them.
Size of the internet by year. Note the logarithmic scale. It's hard to be a portal to all of that! (From Netcraft)
This is history now, but I wonder if it could be the future too. Could this same thing happen to Google? Is it already happening? Let's look at a few of the categories in which Google operates:
- Calendar: sunrise.am is a new calendar service that currently provides extra features to your Google calendar - like a more aesthetically pleasing interface and an automatic meeting scheduler. I've noticed it gaining popularity with my younger (early 20's) colleagues. Of course, Google's acquisition of Timeful might signal that they're working to close the gap internally, but I wonder if other services will come along offering a compelling alternative to gCal altogether.
- News: Google News looks about exactly the same as it did 5 years ago. A very basic interface, stories pulled from other websites, roughly correlated to your interests. It's not bad...it's just not compelling, either. Meanwhile, more innovative news outlets are gaining popularity. Quartz describes itself as a "digitally native news outlet." It's mobile-oriented, and offers fewer, more compelling reads. Similarly, theSkimm is blowing up right now with their simple, editorialized newsletter of everything you need to know for the day. In this category I could go on for days (Vice? Pulse?).
- Image search: Imgur (popularized largely by Reddit and co) has become the dominant service for simple image hosting. A few clicks and anything local is now online and ready to share with friends. The other day, I found myself searching for a funny picture on imgur. I knew it'd be there anyway, so why go through Google's Image search? The good news for Google is that's Imgur's search functionality is currently pretty bad. But it could improve, and more people might find themselves cutting out the middle man.
- Other:
- Shopping: did this ever get off the ground?
- Videos: As Youtube gets more and more choked with ads, I'm seeing a lot more content go to Vimeo.
- Books: refer to shopping.
- Flights: Google does flights? I should click the "More" button more often...
I'd say the areas Google is staying at the top of the pack are Mail (Inbox is clever and has been well received), Maps (through acquisitions like Waze), and of course, Search. Everything else is a little hazier.
Now, I had this article drafted before the big announcement about Alphabet came out. I almost shut this one down, thinking Google had beaten me to the punch with a restructuring aimed at trimming the fat and increasing the focus. And - without a doubt - that is something the Alphabet move accomplishes. But even within the new slimmer and trimmer Google, I think there will be need for added focus. Google will need to consider carefully where it wants to stay a leader, and what it might let go. Because if history has taught us anything, the jack-of-all-trades, master of none will never be king of the hill for too long.
