Google-Bashing
BusinessWeek takes a nice, healthy run at Google and its inability to come up with another smash-hit. In the story, “So Much Fanfare, So Few Hits”, BusinessWeek pokes a big stick at Google's modus operandi to release new services (Spreadsheet, etc.) that receive lots of buzz but only modest acceptance by users. The lead quote by VC Paul Kedrosky sets the tone:
That's a brutally honest assessment that feeds into the argument that Google is a one-trick pony. It raises a few questions: strategically, why does Google insist of releasing these me-too services? Is it simply to keep its employees busy and happy? Is there a master strategy in the works that will somehow tie everything together? Does it really matter if you've got an advertising business kicking off billions of dollars of cash flow?
As Scott Karp points out, coming up with a second “life-changing application” is very difficult for a variety of reasons. Look at Microsoft, which has spent billions of dollars pursuing a smash-hit beyond Windows and Office. Microsoft's efforts include television where it continues to hack away and video consoles, where the Xbox shows lots of promise. Anyone who's into music knows the landscape is dotted with one-hit wonders. The difference between the many artists who come up with a single, unrepeatable stroke of music genius and Google is that Google has a smash-hit that keeps on producing mountains of “royalties”. As long as Google continues to dominate the paid-search business does it matter if it comes up with another successful service - other than for investors who are paying for growth?
Update: The New York Times has a story looking at how Google is building an extensive networking infrastructure and using new technology to innovation and reduce costs.
