Someone asked me recently why Google is afraid of Facebook, and why it would feel the urge to launch a social network to challenge Facebook’s core business. After all, Facebook gets social and it does it quite well. Google, on the other hand, does search better than anyone. On the surface they appear to be two very different beasts, so why can’t they simply get along?
In my mind there are three overlapping answers to this question. The first involves a broad understanding of Google’s mission statement, which is “to organize the world’s information and make it universally accessible and useful.” (boldface is mine). The second has to do with Google’s frustration with closed eco-systems. The third and final answer is based on Google’s awareness of how fragile its core business really is, despite its billions in revenue and massive share of the search market. Allow me to explain.
Let’s start with the first: there are two ways in which you find information on the internet: you either search for it, or you discover it. When you know what you’re looking for you search for it on the assumption that, if it’s out there, Google will find it for you. Indeed, in the pre-Facebook world, search was more or less the only way in which you found information. Each one of us surfed the net in a silo, sharing little with the other millions of people also looking for quality content.
Since the onslaught of Facebook, the second category, discovery, has come into prominence. Discovery often gives you information before you know you want it. I didn’t know, for example, before I saw it, how much I enjoyed goats who sound like people. Then I discovered it, shared it, and helped direct a lot of internet traffic in that direction.
Whether you are searching for or discovering information, both boil down to the way in which you get from one site on the internet to another through links. It is a lot like the infamous quote about literature, “there are only two stories; a man goes on a journey or a stranger comes to town”. Ultimately, both search and discovery do the same thing, so it’s not difficult for one to overcome the other.
Therefore, Google’s attempt to enter the social space is at its core a defensive measure to protect its core business of connecting people to information. After all, if Facebook manages a massive chunk of the entire internet’s traffic, it would not be too difficult for them to launch a search engine, possibly based on social signals, and dis-intermediate Google’s relationships with its users (in the end, lots of people can make money on the internet, but only those who establish and preserve relationships will prevail). Once you understand this, Google’s vision becomes a lot clearer: Google doesn’t want to compete with Facebook on a social playing field; instead, it wants to do the opposite of what I suggested Facebook could do by competing on a search playing field through making search a lot more like discovery. Google already has a relationship with you: now it wants to take that relationship to the next level (insert third base joke here).
Second, Google hates closed eco-systems, hence my emphasis on universally accessible. Facebook, if you haven’t noticed, is hardly searchable from outside Facebook. Therefore, any content that is created on Facebook is useless to Google. Imagine if Wikipedia didn’t allow Facebook to index its content: all of a sudden Google becomes a lot less useful if a large chunk of the content on the internet isn’t available to it. It is for this reason as well that Google advocates for free speech: censorship makes the internet less useful because it prohibits certain information from being search-able. As such, what’s good for the growth of an open internet is good for Google.
If you ask people at Google about the company’s main difference with Faceook, they would likely tell you that Google is open and Facebook is closed. If, for example, you want to export all of your gmail contacts to another service you can do this easily. On the other hand, try exporting your contacts from Facebook, and you’ll quickly see how difficult it is. Facebook claims to be protecting your privacy, but it is also rather conveniently making it harder for you to move from one service to another. Google believes at its core that you should always do what’s right for the user, even if it’s not good for business (insert counter arguments here. I know. They exist). Openness, therefore, is both a core tenant of the company’s philosophy, as well as a necessity in order to ensure the usefulness of the main money-making service it offers.
Lastly, as a company that has grown faster than almost any other in modern times, Google is keenly aware of the fact that, as Eric Schmidt is prone to saying, “competition is only a click away.” After all, Google manages a large chunk of the internet’s traffic: any changes to its algorithms that re-order search results can make or break businesses (I’ll write about this at some point, as I dealt with angry publishers at lot when I worked there). Google survives today on the strength of its brand (Here’s a trade secret: Bing isn’t that far behind in overall search quality, but saying you’re going to ‘bing’ something sounds like innuendo), which inspires loyalty both because it was the first good search engine as well as because people think it is a cool company (it helps that the brand name is also used as a verb synonymous with “to search”). Brands go in and out of fashion, but unlike some companies, Google cannot afford for its brand to go out of style or to be dis-intermediated. Once users leave, advertisers will follow suit, and the entire empire can come crumbling down faster than it was constructed. On this point, Eric Schmidt cited Siri in his testimony to congress last year. If people use Siri to answer all of their questions Google finds itself without any users. Case and point.
How does Google beat Facebook? The truth is, it doesn’t have to. Of course Google wants Google+ to succeed; indeed, unlike other non-search products, Google rallied the entire company around Google+, and as the product progresses its inter-connectedness with other Google products will become more and more evident. At any rate, Google+ is also a challenge to Facebook’s vision of a walled garden: if Google forces Facebook to open up then to a certain extent it wins. Indeed, since Google+’s launch Facebook has become a lot more open: it’s no coincidence that Facebook now allows you to post publicly to the entire internet. If Google provides a compelling alternative, Facebook has two options: ignore it and hope that users will stay loyal, or copy it and give the users what they want. Then, when Facebook changes, the entire internet is forced to take note.
Google has good reason to fear Facebook, just as Facebook has good reason to fear Google. It’s likely that, should they both attract talent (including from each other) and continue to be well managed, they’ll find a way to co-exist while continuing to compete for some time. Both will have to learn to be ambidextrous, which in the business context refers to continuing to grow its gore business while innovating fast enough to compete on other fronts.
Personally, my hope is that the winner is an open internet, regardless of where it comes from.