HIGH FIDELITY

Google is interested in:

• An excellent user experience for all of their products; in the early years of the company Google avoided taking advertising on search pages because they strongly believed in growing their user base first. Like Facebook, they take an extremely long view and – almost as a rule — do not chase short-term monetization. In fact, many of their finest products make little or no revenue on their own (e.g. Google Maps, Google Earth), but must be seen within the constellation of other Google products.

• Being world-dominant in certain areas, including:

1. Advertising: by forcing it to be more metrics-based, accountable and efficient;
   
2. The digitization and distribution of information;
3. The distribution of content: through platforms such as YouTube, Google TV, the impending eBook store, the pending Music Store (not to be confused with its current iteration), Android-based mobile phones;
4. The collection of user data (though they don’t admit this): via searches typed into Google, the use of Gmail accounts and Google Documents, the near-ubiquity of Google Maps, a huge push into the mobile operating system market through Android, the launch of the Chrome web browser, etc. In triangulating between all of these interactions by a user, Google ends up possessing a great deal of data about that particular user. This allows them to continue to improve the user experience of their products, as well as serve more targeted advertising.

Google is not interested in (based on observations of their behavior):

• short term revenue initiatives;
• exclusive deals with any particular content partner;
• selling hardware devices;
• traditional media business models.

The Google Music potential:

Give users a music store, with songs and albums tied into search results, and allow them to be bought and ported effortlessly to any Android device (on a cost per song or subscription-basis). Other than securing the licensing deals with the labels, quick and easy. No need to use downloaded software like iTunes or physically sync a device to a computer.

Google + Android + Music = a virtuous cycle of influence and revenue

1. Google’s primary revenue stream is advertising;
2. The more devices running Android, the better it is for Google’s advertising initiatives, for a couple of reasons:
   1. Devices running Android are more “open” than devices running Apple, Microsoft or Blackberry systems, and therefore not subject to control by those companies;
   2. Android natively works with other Google products – some of which are advertising-based, all of which collect data – in a seamless way;
   3. In 2009, Google acquired one of the largest mobile ad platforms in the world, AdMob, allowing them to better control ad serving on Android (and iPhone) devices; between ’07 and ’09 alone, mobile search queries increased 500% — all of these queries are advertising opportunities;
   4. Consumer adoption of Android devices is driven by better and better content being available to the users — music, TV shows, apps – and seamless interaction across other Google mobile services, such as Maps, Gmail, YouTube;
   5. Go back to step #1, and repeat.

The viewpoints expressed herein are my own, and not necessarily those of my employer.