Google Diversification, Search Fading?

In terms of the interwebs, the last decade could aptly be described as the search decade. Google ruled the day. As newbies came online Google was the launchpad where they all began. The company grew to a massive $170 billion market cap. It fended off competitors and, in the process, put more than a few out of business. By any measure, Google won the search war.

I predict that the next decade will be less about one single theme and significantly less about search. Obviously, I am on the outside looking in but these are my thoughts: Google is keenly aware of the fact that this transition is already occurring. To counter this anticipated reduction in traffic, Google has diversified into, well, just about everything relating to your preferences. Google continues to focus on its mission of organizing the world’s information. To do this, it needs to collect information. Where is lacks information, it devises a solution for obtaining it. In no particular order:

Whom do you phone? Google Voice.

To whom do you write? Gmail, Google Wave and Google Buzz.

What do you buy? Google Checkout and Google Product Search.

What do you watch on television? Google TV, which is anticipated to launch with Sony next month.

What do you read? Google Reader and Google Scholar, despite some bumps in the road.

Where do you eat? Google Maps, 800-GOOG-411, Google Places.

What ailments do you have? Google Health, although it appears to be a flop.

Where do you work? Google Profiles.

Where do you live? Google Maps.

What do you look like? Google Profiles and Google Visual Search, perhaps tied together one day.

Where are you? Latitude, Google Buzz and Google Places.

Where did you go and where will you go? Google Calendar.

And, I’m sure I’m missing more than a few fronts where Google is amassing information. As we all know, Google collects this information to sell advertisement space on your screens and mobile devices tailored to you. The genius of this all is that people actually trust Google, perhaps rightfully so. Advertisers do not have access to the answers to every question above, only Google does. Google has been and will be fundamentally an advertising intermediary. The game has changed: it’s no longer about finding something.com hidden away somewhere in the deepest depth of the internet but it’s more likely about giving you what you want, often for free, in exchange for your preferences. What do we receive for free? Search, email, voice transmission, video transmission, web apps, operating systems (albeit not directly but, rather, by eliminating the OS “tax” on devices), news, financial information and the list goes on and on. Most of the world has decided that we benefit from this exchange of preferences for free services. It’s really a unique and fascinating model. Eric Schmidt, Google CEO, recently used the term “platform provider” to describe what Google wants to become. It’s a unique type of company unlike any other.

[As an aside, contrast the Google model with Facebook which simply wants to collect your preferences and share them with the world. The Facebook model is a far less comfortable compromise for the person the least bit concerned about privacy.]

Google is diversifying in other ways too. Google Apps, the enterprise version of the free online office suite, will probably meet with tremendous success. This arena is monetized differently. No business enterprise wants to share its confidential information with Google in exchange for advertisements. Instead, for a reasonable cost, companies pay for the cloud-based services. Google Apps fundamentally differs from just about every other Google property in this regard.

Google sits on a boatload of cash right now and could diversify into other areas as well. It dipped its toes into the hardware water with the Nexus One but I do not anticipate a significant push in the hardware direction. Google simply wants more, better information and faster. By diversifying, Google has solidified itself as the conduit through which we deposit our preferences and information and donate some eyeball movements and mindshare to advertisements that we might find appealing.

[I will likely write a follow-up piece regarding competition in the "platform provider" business with a focus on Facebook.]

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