Geeks and media keep raving about Google's nonsearch services - online word processor to compete with Word, online spreadsheet to compete with Excel, online payment system to compete with PayPal (Sample headline: "Google Readies PayPal-Killer"), BlogSearch to compete with Technorati, instant messaging to compete with all. But, writes BusinessWeek,
Google has yet to establish a single market leader outside its core search business. (...) Google Talk, an instant-messaging service launched last August, now ranks No. 10, garnering just 2% of the number of users for market leader MSN Messenger. (...) Three-month-old Google Finance, heralded as a competitor to market leader Yahoo Finance, has settled in as the 40th-most-visited finance site. (...) Gmail (...) is the system of choice for only about one-quarter the number of people who use MSN and Yahoo e-mail.
When it launches a new service, Google is often considered a presumptive winner. But
after sparking substantial buzz, most of Google's nonsearch offerings quickly fade from view. "People give Google the victory in the beginning and don't show up later to notice that things didn't go anywhere," says Paul S. Kedrosky (...) "Google has product ADD. They don't know why they're getting into all of these products".
Laurent Haug speculates that "maybe these products are there to make search more relevant", and certainly that plays a role. Also, they create more display space for Google-managed text-based contextual ads. Google also doesn't seem to have found a clever way to consistently drive users of its search services to its other features.
I have heard another theory recently: that many of these services are not part of a services strategy, but are the output of a deliberate human-resource strategy.
Google wants to hire and keep the best and brightest. But after a while they get bored with search algorithms and server load balancing and AdWords auctioning, so they are allowed, even encouraged, to work on other stuff they like. Google has managed to "sell" this as a thoughtful innovation strategy, claiming that a high failure rate is built into its DNA: we give people 20% of work time to devote to their own projects, and out of a thousand bright ideas freely developed by bright engineers will come a few truly innovative and hugely successful gems. And a few they are: Google Maps, Google Earth (which was developed by another company bought by G) and Google News. Google Video is showing potential, too. Short list, but it doesn't really matter, as long as the staff is happy and, after developing the most popular social networking site in Brazil (Orkut, another category killer that didn't deliver, and is no longer listed on Google's products list), they go back to work on making sure that the search page remains hyperdominant and the ads (99% of Google's revenues) relevant.