Today is a nice winter morning. The sun is shining through the curtains, promising a good and calm day. With a cup of hot coffee I turn on my computer and open the browser. What’s up? What has happened? Instead of my home page, I get 404 error - Page not found. Any problems with my provider? I am trying to open other websites. Everything seems ok. What has happened with…?
GOOGLE?!
What’s up with Google? Has the Apocalypse started today?
Oh, and I have not washed my hair!
Millions of people all over the world will ask this question when they turn on their computers in the morning. What site do you typically use if you want to find any information online? Most people will answer that they just open http://www.google.com/ and make a query. Google has become the largest Internet search engine in the world - an easy-to-use free service that returns relevant results in less than half a second. The transitive verb "to google" has entered our lexicon and become a synonym for “searching online”.
Disappointed with the morning Google death, I am trying to recollect any other search engines where I can find information online. Yaha? No, Yahoe? Ah, Yahoo! At last I found one more search engine. The news headlines tell me that Google has gone out of business. It declared bankruptcy and closed the site. The video sharing platform YouTube is unavailable, communication tools (Gmail, Blogger) are frozen, the advertisements (AdWords) aren’t shown any more.
How did it become possible? It is a well known fact that Google passed all rival search engines in the number of queries that users make. In December 2008, it gained 70.5% market share, up 8.0ppts versus 2007. Its closest rival Yahoo! was reported to have only 19.0% market share. Windows Live Search stayed at 6.9% market share with amazing 9.8% query volume growth. Ask and AOL held on with 2.4% and 1.0% market share, respectively. What will happen with search market today?
I am recollecting the early days of Google. There were two main reasons why Google, the creature of Stanford graduate students Sergey Brin and Larry Page, become a widely recognized search heavyweight champion of the world. First of all, you could find exactly what you want within a very small period of time (Google likes to boast about it: "Search took 0.17 seconds."). In the early days of Internet search engines, finding necessary information looked like fishing in a canal: you could catch something good, but you could also hook a rubber boot or an old tin can. Will we return to canal-fishing again?
The next reason of Google success was a very simple design. Its original home page was very unusual and catchy because it was simple! There was just a logo, a text field, and two buttons - Search and I’m Feeling Lucky. That’s all! And what do I see on Yahoo? Superfluous links, banners, news headlines or other bells and whistles that I actually don’t need!
Google was not the first search engine that appeared online. There was Archie, created in 1990 by Alan Emtage, a student of McGill University in Montreal, Canada. Then other similar websites appeared, for example Yahoo!, Excite, AltaVista, Lycos, Infoseek and Ask Jeeves. But Google is the only search engine that has become a utility, as vital as electricity, gas and running water. I don’t want to live without water!
Of course, Google changed for 10 years. New useful services and applications piled up like Christmas presents. Besides web searching, you could find information in many different languages, start your own blog, check driving directions, watch popular videos, read news headlines and search billions of images. As million of other people, I used to its convenience. Google was my all-purpose tool, so what shall I do now?
Google was an encyclopedia, a map, a photo album, a shopping catalog, a trip planner, a phone book, a notebook and news archive rolled into one. Plus, it was a source of income and a constant job for many Internet users. And for me, too. Oh, am I jobless now?
Luckily, the situation above is just hypothetical. Google is working perfectly today. However, there are a lot of people who can't imagine their life without this search engine. In their mind the Internet is closely connected with Google. What will happen to them if one day http://www.google.com/ stops working? Will our world remain the same or change forever?
The similar situation happened on February 1, 2009 when Google didn’t function for nearly 55 minutes due to a human error. This event became even more popular when the World Cup. People wrote numerous blog posts and messages to friends telling “Google doesn’t work!” We are so used to this search engine and its numerous services that no Google can be similar to no Internet at all.
Let’s analyze the financial consequences of Google's death for the Internet users and the virtual economics. How many people will lose their job? How much money will lose our country? The business side of Google can be even more interesting than the technological one.
Google AdWords
On the surface, a search engine, even the most popular one, doesn't seem like the most profitable business. The company provides search results without charging any fee. However, according to financial reports, in the fourth quarter of 2008 Google earned $5.70 billion. It is a 3% increase over third quarter 2008 revenues ($5.54 billion) and an 18% increase over fourth quarter 2007 revenues ($4.83 billion). How does Google make so much money?
The answer is simple. Google is a major player in the online advertising industry. It earns most of its revenue by allowing other website owners to advertise on its search result pages. This program is called AdWords. Every time you perform a search in Google, you will see ads displayed along with your results.
As opposed to some other search engines, Google doesn’t sell placement in the search results themselves, or allow website owners to pay for a higher ranking there. When you make a query, you will get a separate list of websites that are the most "relevant" (read: popular), and a separate list of “sponsored links”.
What can change with other search engines? We will lose the opportunity to choose. Using other search websites, you can’t be so sure whether you get what you need or what has been paid for. The Internet will lose that important balance between ads and the most popular sites. Are you sure that you want to be cheated?
All Google ads are typically relevant to the query that a user makes. A potential advertiser specifies what search keywords he or she would like to have. For example, if you sell used cars in Florida, you can choose a keyword that involves the city in which you do business and the type of your business - "Florida used cards." This makes the advertising useful to an Internet user as well as to the advertiser placing it.
Thousands of companies all over the world use Google AdWords program to promote their goods and services online. It is an excellent way to attract Internet users who can be interested in what you offer. Recent advertisers include such giants as Amazon and Cisco Systems.
Selling ads is a very profitable business for Google. In the fourth quarter of 2008, the revenues of Google-owned sites reached $3.81 billion, or 67% of total revenues. It is a 4% increase over third quarter 2008 revenues ($3.67 billion) and a 22% increase over fourth quarter 2007 revenues ($3.12 billion).
AdWords program has numerous benefits for advertisers. First of all, as it was mentioned above, it is targeted to relevant searches and content pages. Then, the program is cost-effective - advertisers pay only when potential customers click on their ads. One ad costs from a few pennies to a few dollars per click.
Google ads reach a broad audience because they are displayed across Google's growing network of partners that includes thousands of sites from America Online to the Washington Post. It lets companies of all sizes get in front of everybody who uses the Internet.
If one day Google stops working, the advertisers won’t be able to reach a broad audience as efficiently as before. There are just no alternatives to online advertising! Newspapers and magazines don’t have such a broad reach. The effect of television advertising is generally much higher than the effect of newspaper and magazine advertising but TV commercials are very expensive.
Google AdWords main competitors are Yahoo! Search Marketing and Microsoft adCenter. However, they don’t have so powerful system of selling and displaying ads in association with their own search engine, so these advertising programs can’t attract many customers. By now Google has a 75% monopoly for all external referrals to most websites.
Without Google ads, thousands of companies will go out of business. It mainly concerns small firms that do their business online, for example Internet stores. Their target audience is the Internet users, so without online advertising they won’t be able to promote their goods. Of course, they can buy links on large portals, but it won’t have the same effect as Google AdWords has. And what will we have as a result – only giants making business online? Do you really want it?
Google AdSense
If you have a website with interesting content and good traffic, you can get your portion of the revenue that Google gains from AdWords. Have you noticed boxes or columns containing text-link ads on many websites which say "Ads by Google"? This program is called AdSense. You display these ads on your site, and Google pays you for every click on them.
Google can automatically determine the subject of your web page and place relevant ads based on the advertisers' keywords. Such advertisements are considered to be less intrusive than banners. That’s why context advertising becomes more and more popular. According to statistics, aggregate paid clicks, which include clicks on ads displayed on Google-owned sites and the sites of AdSense partners, increased approximately 18% in the fourth quarter of 2007 and about 10% in the third quarter of 2008.
AdSence program is not so profitable for Google as AdWords, but it helps them to increase their profits. In the fourth quarter of 2008, Google earned $1.69 billion through AdSense programs, or 30% of total revenues. It is a 1% increase over third quarter 2008 network revenues ($1.68 billion) ad a 4% increase over fourth quarter 2007 network revenues ($1.64 billion).
Google doesn’t disclose exactly how much website owners earn for each click that customers make. The commission depends on the amount that advertisers pay Google for the particular ad. You will receive a share of that amount - from 2 cents to $15 per click. However, even if Google pays only 20% of their network revenues then it means that the sites owners earn over 1 billion dollars per year.
If Google closes AdSense program, Internet industry can fall into decay. After dot com era end in 1999, Google AdSense program has fueled up the emergence of thousands of new websites. This system offered a simple and reliable way to make money online. Nowadays a good resource can help its owner earn $10.000- $50.000 a year.
Trying to increase their profits, thousands of webmasters spend time and money creating new sites with interesting content. The more people they attract, the more money they will receive. The end of Google AdSense could mean the end of these websites, which will result in ending of dot com era once again.
AdSense program is also important for delivering advertising revenue to small websites that do not have necessary resources for developing advertising sales programs and employ sales people. Without this program, thousands of non-profit sites will be closed just because their owners won’t have enough time or funds to support them.
In addition, Google AdSense is profitable not only for webmasters and websites owners, but for many other professionals working in IT sphere. For example, there are a lot of people who want to share their successful business stories with other Internet users. They create e-book teaching how to make money online with Google AdSense program.
One of the most popular authors who writes on this subject is Joel Comm. He earns thousands of dollars from his e-books. Will he earn the same amount from his “Google AdSense memoirs” or “That good old Google”?
Page rank
Google works similar to many other search engines in its basic principles of operation. It has powerful software programs that explore and analyze web sites. What has made Google unique is that it takes note of how many other pages have links to any given page. It helps Google determine a page's importance, or a page rank.
In general, Google considers a link from page A to page B as a vote for page B by page A. However, Google doesn’t only count the number of links a page receives, but it also analyzes the page that casts the vote. If there are many relevant links to a particular page, it will receive a higher page rank and appear on the first pages of the search results.
Page rank varies from 0 to 10 for each webpage on the Internet. It shows how important this page is in the eyes of Google. Website owners need to receive a good Google's page rank if they want to get traffic to their sites and earn profit. It is a well know fact that 90% of all purchases take place on the first page of the search engines.
There is a special type of business which helps websites raise their PR and get more traffic – SEO. It can be divided into website optimization and marketing optimization. The first one concerns the design, interface, programming, content, and all other website enhancements.
Marketing optimization includes advertising and link building strategies targeted to increase the search results. Famous SEO specialists, such as Barry Schwartz, Aaron Wall, Rand Fishkin and Jill Whalen write books telling about various approaches to SEO. You can also visit conferences or read numerous online blogs on this topic.
If there is no Google, SEO specialists will lose their main source of income. It also concerns people who earn money by trading links and writing websites context. The army of jobless IT specialists will drop the average salaries in this sphere. If you earn $15-$25 per hour, you can get just $10-$15 in future.
And don’t forget that Google employees will be also looking for a job. On December 31, 2008, the company has 20,222 full-time employees. Google spent $890 million in payroll-related and facilities expenses in the fourth quarter of 2008 in comparison with $859 million in the third quarter of 2008.
The sudden death of Google and its Page Rank system would have a devastating effect on the internet business. Every company’s profits correlate very strongly with its Google page rank. If Google dies and everyone starts to use other search engines where they do not rank highly, they could declare bankruptcy very quickly.
Other search engines have completely different systems of determining the page importance, so it is very easy to turn from a huge power in Google to nothing in MSN. For example, nowadays Google gives more weight to off page factors such as IP spreading. MSN pays more attention to on page factors such as density and proximity.
Of course, if your company has a large marketing budget and regular clients, you can keep it afloat for 6-12 months while you are re-optimizing your site for Yahoo! or Microsoft's Live Search. But what if not?
Many companies have already spent thousands of dollars to build a high Google page rank and receive an opportunity to be shown on the first page. If there is no Google and its PR system, than this money is just wasted! The companies will need to find additional funds to promote their websites. It means to cut salaries and fire people.
Due to the reasons mentioned above, Google’s death will affect mainly small and medium-sized companies. Large enterprises and big portals will be easily found in any search engines. If there is no Google, small business all around the world will lose their main marketing tool a good PR.
Gmail
You really don’t have a Gmail account? Are you kidding?
According to the list of 40 most visited subdomains of Google.com, Gmail and Google maps are the most popular Google services. The statistics shows what in November 2008, Web Search (http://www.google.com/) was visited by 126,269,804 unique visitors, Image Search (images.google.com) was visited by 43,023,240 unique visitors, Google Maps (maps.google.com) was visited by 36,914,680 unique visitors and Gmail Google Mail (mail.google.com) was visited by 24,895,354 unique visitors.
Gmail is one of the best free email services in the world. Its main advantage, of course, is 2 gigabits of storage space. That's more space than most other web based email services offer. In fact, when Google announced on April 1st, 2004 that it was giving Internet users a gigabyte of storage, many people thought that it was a joke. At that time, Hotmail from MSN provided just 2 MB of space; so how can a competitor offer 500X?
Besides the storage space, Gmail has a lot of other amazing options and features that attract people. You can set up filters and labels to organize your mail, archive your mail for easier searches, check your Gmail through a mobile phone and get notifications of new messages on your desktop. Google spam filter is considered to be one of the most effective.
No wonder that Gmail is so popular. But imagine what will happen if one day 24,895,354 unique visitors won’t be able to open their Gmail? I would describe this situation as total chaos. First of all, companies and freelancers will lose many clients. Do you keep a list of your partners’ e-mails in a special notebook? Are you sure you’ll be able to find them all without access to your Gmail account? Nobody will be looking for your new contact information – it is much easier to find other people or companies.
Then, the change of e-mail means the change of all business cards and advertising items. You will need to update your website and inform a lot of people about your new e-mail. It means expenses, expenses and expenses.
Then, the average Gmail user doesn’t delete old messages to make room for new. Two gigabits mean a plenty of storage space! So you can lose important documents, invoices and orders that you held in your e-mail.
Google shares
As we have already mentioned above, Google makes most of its profit from online advertising. However, Google's share price is also strong. The company is listed under the ticker symbol GOOG on the NASDAQ stock exchange and under the ticker symbol GGEA on the London Stock Exchange.
According to the Google’s financial report, in the last quarter of 2008 GAAP earnings per share were $1.21 on 317 million diluted shares outstanding, in comparison with $4.06 in the third quarter of 2008 on 318 million diluted shares outstanding. As for Non-GAAP earnings per share, they were $5.10 in the last quarter of 2008, in comparison with $4.92 in the third quarter of 2008.
The Google IPO took place on 19 August 2004. Now its shares are worth over $350 each (to be exact, the price on February, 10 is $358.51). Taking into consideration that their starting price was between $80 and $100 per share, the company’s stock performance is going well.
If Google declares bankruptcy, then the share price will significantly decrease. In fact, the stock itself will become worthless, leaving shareholders unable to sell their defunct shares. Millions of people will lose their investments.
Many companies invest money from IRA accounts in shares. What if your company bought Google shares, and their price became $0? You will lose all you retirement funds.
Google’s death will also cause a significant drop of the stock value of other online companies (for example, Match.com or Sina corp). Do you know how dominoes fall? There will be the same effect.
Investors will decide that if Google, the Internet search giant, is out of business, than smaller companies doing business online are definitely unreliable. So they will try to get rid of their shares. It will lead to great financial losses and even bankruptcies of many Internet companies. Dot com world will be ruined.
Google Foundation
Google is famous for its charity programs. Every year the company commits “one percent” of its equity and profit to various non-profit organizations. Google makes donations through the Google Foundation ($90 million cash donation) and Google.org ($175 million donation).
Google Foundation has already contributed five million dollars to support Acumen Fund, a non-profit company targeted to solve the problem of global poverty. Acumen Fund helps entrepreneurs deliver affordable goods and services to the four millions of people worldwide who live on less than $4 a day.
Google.org includes projects that the company manages itself. An example is the Google Grants program, which places free ads of selected nonprofits.
Google Grants has donated $33 million in advertising to more than 850 nonprofit organizations in 10 countries. The participants include Make-a-Wish Foundation, Doctors Without Borders and Grameen Foundation USA.
If Google goes out of business, many non-profit organizations won’t be able to tell people about their mission and receive help. Maybe it won’t have a large influence on the virtual economics, but of course it will make our world a bit worse. Social problems can be as important as economical ones.
If not Google then who?
It goes without saying that nowadays Google is the most important company on the Internet. It has become something more fundamental than a simple search engine. Which brings up an obvious question: if this search engine goes out of business, who can become “the next Google”? What company can be as important as Google was? There are several versions that are worth analyzing.
People used to live with search engines. If Google dies, many users and companies will look for similar resources. They will recollect that there are other search engines on the planet that appeared even before Google.
The first choice, of course, is Yahoo. Google’s dominance forced this search engine into a second-fiddle role, but it is still a major player. Yahoo search results are also relevant and fast. Plus, it has a wide array of internet services to deal with – Web search, Images search, Video search, Local search, Jobs, Shopping, News, Travel, Maps, Real Estate, Yellow pages, Games, Finance and many others.
One of the main advantages of Yahoo! is their popular Yahoo! Answers. Many people use it because Google doesn’t offer any alternatives. This service is like the second search engine. If you can’t find necessary answers in web, you make a query on Yahoo! Answers. In most cases, you will get several variants of answer from other Internet users.
Yahoo has all chances to become the Internet leader after Google. It has a necessary combination of search functions and useful additional services. However, its main target is to entertain, not to sell or promote goods. Yahoo! lacks some important commercial component that will help sites to survive after Google’s death. Yahoo dominance will turn the Internet from a money making tool to a colorful multimedia center.
The next search engine that has a chance to become “the next Google” is Microsoft Live, or MSN. Its Internet portal, MSN.com, is currently the 6th most visited domain name on the Internet.
What do Google and MSN have in common? Good financial opportunities. Google, with over 8 billion dollars in cash and no debt in its financial structure, can make investments in two main areas: product development and acquisitions. That helps them stay the industry leader. The only other company that has the same financial opportunities is Microsoft, which currently has over 9 billion dollars and no debt in its own financial structure.
MSN Search was launched in the fall of 1998. In 2006 many of its services were reorganized under a new brand name, Windows Live. This move was a part of Microsoft's strategy to improve its online offerings using the widely recognized Windows brand name.
After the launch of Windows Live, the focus of MSN shifted to online news, entertainment, and providing common interest content through its Internet portal, MSN.com. Windows Live offers most of Microsoft's online software and services.
The most popular MSN Services are MSN Search (now called Live Search), MSN Hotmail (now called Windows Live Hotmail), MSN Messenger (now called Windows Live Messenger), MSN Virtual Earth (now called Live Search Maps) and MSN Spaces (now called Windows Live Spaces).
There are also some other small search engines like Quintura and Cuil that call themselves "Google Killers." They are rather simple and don’t have numerous additional services. Of course, without Google they can improve their search software and try to capture more market share in that space. But since a key success factor in the market is providing more than just web search, such small companies will be at disadvantage. No doubt that they won’t become an adequate substitute for Google search engine.
Alternatives to Google Services
As I have already told, Google is not only a search engine that has the majority of the search engine market. It is a large platform that includes numerous free additional services like Gmail, GoogleMaps and GoogleEarth, its main revenue service AdWords with the Pay-Per-Click advertisements, Picasa web albums, the video sharing platform YouTube, Calendar, Notebook and others.
Additional services and facilities make Google the unique resource where Internet users can spend most of their online time. And they are absolutely sure that they are surfing Internet, not Google!
However, dot com world can offer alternatives to nearly all services that Google has. Some of them may not be as elegant as Google's, but if you can’t use this search engine any more, it shouldn't be that hard to start using them.
Plus, keep in mind that without Google’s dominance all these alternative resources will receive a great stimulus to develop and become the leaders in their area.
We have collected some popular websites that can become a good choice in case if Google decides to go out of business.
Google Image Search – Yahoo Image Search
Google News - Yahoo News, Web 2.0, Rootly, MSN news
Google AdWords - Yahoo! Search Marketing and Microsoft adCenter.
Google AdSense – adBrite, Clicksor, Bidvertiser, Chitika, Fastclick
Google mobile services - MSN Mobile
FeedBurner - Zookoda
YouTube- Vimeo, Blip.tv, Rewer
Google Earth and Google Maps – Yahoo Geocities, Yahoo Maps, MSN City Guides, MSN Maps and Directions, GenieKnows
Gmail – Yahoo mail, Windows Live Hotmail
Google Notebook – Zotero, Evernote, Clipmarks, Microsoft OpenNote
Picasa Web Albums – Photobucket
Google Talk – Yahoo messenger, MSN messenger
Google Groups – Yahoo groups, Windows Live Groups
Google Directory – Yahoo Directory
Google Analytics – Mint, Extreme Tracking.
Google Calendar – Yahoo calendar
Google Translate – Fretranslation.com
Google Toolbar - MSN Toolbar, Yahoo Toolbar
Blogger - Yahoo MyBlogLog, Livejournal.com, MSN Spaces
As you see, there is a good alternative to nearly every Google service. Knowing these options you can make your online experience more enjoyable. However, you will need to browse several websites instead of just one - www. google.com.
Final Thoughts
Can you imagine your life without online search engines? I bet not. With the dramatic increase of available information, it has become very important to find exactly what we need. Search engines is the first place to start when we are looking for telephone numbers, addresses, weather forecast, opening times, a person's name, images, flight details, hotel descriptions, currency rates and other data.
According to statistics, an average American opens Google.com over 100 times per week. Our relationship with this website has changes from want to need. We need Google because our life is closely connected with its functions and services.
Thinking about everything that Google does, the company really deserves its leading position. It has become the basis of the Internet world and e-commerce. If one day Google stops working….no, the Earth will not stop to revolve on its axis. The virtual economics and, as a result, the everyday life of many people will considerably change.
As a conclusion, let’s sum up why Google has such a great influence on our virtual and real life.
- Google has developed a great search engine that fulfills one of the most important tasks on the Internet - find exactly what you want within a very small amount of time.
- Google always tries to create simple interfaces that people like.
- Google AdWords lets companies promote their services and products as efficiently as it possible and earn profit.
- Google is the main source of income for many website owners.
- Google PR system caused the appearance of a new branch of IT business – Search Engine Optimization.
- Google spends its profit on the solution of social problems.
- Google offers new creative ideas that other companies would reject, for example providing a gigabyte of space for e-mail.
- Google means Internet for many users.
Do you want to lose it all?
The latest events on the international markets, political prognoses and news headlines make us start thinking – “Will Google survive in this financial crisis? What will happen in the nearest future with all IT industry?” There are many reasons why Google can go out of business, starting from stock downfall to technical failures. Fortunately, the Internet, as an international community of millions of people and companies, will remain in any economical environment. People will always search for information, goods and services. It means that Google has all chances to stay with us for a long time.
GOOGLE?!
What’s up with Google? Has the Apocalypse started today?
Oh, and I have not washed my hair!
Millions of people all over the world will ask this question when they turn on their computers in the morning. What site do you typically use if you want to find any information online? Most people will answer that they just open http://www.google.com/ and make a query. Google has become the largest Internet search engine in the world - an easy-to-use free service that returns relevant results in less than half a second. The transitive verb "to google" has entered our lexicon and become a synonym for “searching online”.
Disappointed with the morning Google death, I am trying to recollect any other search engines where I can find information online. Yaha? No, Yahoe? Ah, Yahoo! At last I found one more search engine. The news headlines tell me that Google has gone out of business. It declared bankruptcy and closed the site. The video sharing platform YouTube is unavailable, communication tools (Gmail, Blogger) are frozen, the advertisements (AdWords) aren’t shown any more.
How did it become possible? It is a well known fact that Google passed all rival search engines in the number of queries that users make. In December 2008, it gained 70.5% market share, up 8.0ppts versus 2007. Its closest rival Yahoo! was reported to have only 19.0% market share. Windows Live Search stayed at 6.9% market share with amazing 9.8% query volume growth. Ask and AOL held on with 2.4% and 1.0% market share, respectively. What will happen with search market today?
I am recollecting the early days of Google. There were two main reasons why Google, the creature of Stanford graduate students Sergey Brin and Larry Page, become a widely recognized search heavyweight champion of the world. First of all, you could find exactly what you want within a very small period of time (Google likes to boast about it: "Search took 0.17 seconds."). In the early days of Internet search engines, finding necessary information looked like fishing in a canal: you could catch something good, but you could also hook a rubber boot or an old tin can. Will we return to canal-fishing again?
The next reason of Google success was a very simple design. Its original home page was very unusual and catchy because it was simple! There was just a logo, a text field, and two buttons - Search and I’m Feeling Lucky. That’s all! And what do I see on Yahoo? Superfluous links, banners, news headlines or other bells and whistles that I actually don’t need!
Google was not the first search engine that appeared online. There was Archie, created in 1990 by Alan Emtage, a student of McGill University in Montreal, Canada. Then other similar websites appeared, for example Yahoo!, Excite, AltaVista, Lycos, Infoseek and Ask Jeeves. But Google is the only search engine that has become a utility, as vital as electricity, gas and running water. I don’t want to live without water!
Of course, Google changed for 10 years. New useful services and applications piled up like Christmas presents. Besides web searching, you could find information in many different languages, start your own blog, check driving directions, watch popular videos, read news headlines and search billions of images. As million of other people, I used to its convenience. Google was my all-purpose tool, so what shall I do now?
Google was an encyclopedia, a map, a photo album, a shopping catalog, a trip planner, a phone book, a notebook and news archive rolled into one. Plus, it was a source of income and a constant job for many Internet users. And for me, too. Oh, am I jobless now?
Luckily, the situation above is just hypothetical. Google is working perfectly today. However, there are a lot of people who can't imagine their life without this search engine. In their mind the Internet is closely connected with Google. What will happen to them if one day http://www.google.com/ stops working? Will our world remain the same or change forever?
The similar situation happened on February 1, 2009 when Google didn’t function for nearly 55 minutes due to a human error. This event became even more popular when the World Cup. People wrote numerous blog posts and messages to friends telling “Google doesn’t work!” We are so used to this search engine and its numerous services that no Google can be similar to no Internet at all.
Let’s analyze the financial consequences of Google's death for the Internet users and the virtual economics. How many people will lose their job? How much money will lose our country? The business side of Google can be even more interesting than the technological one.
Google AdWords
On the surface, a search engine, even the most popular one, doesn't seem like the most profitable business. The company provides search results without charging any fee. However, according to financial reports, in the fourth quarter of 2008 Google earned $5.70 billion. It is a 3% increase over third quarter 2008 revenues ($5.54 billion) and an 18% increase over fourth quarter 2007 revenues ($4.83 billion). How does Google make so much money?
The answer is simple. Google is a major player in the online advertising industry. It earns most of its revenue by allowing other website owners to advertise on its search result pages. This program is called AdWords. Every time you perform a search in Google, you will see ads displayed along with your results.
As opposed to some other search engines, Google doesn’t sell placement in the search results themselves, or allow website owners to pay for a higher ranking there. When you make a query, you will get a separate list of websites that are the most "relevant" (read: popular), and a separate list of “sponsored links”.
What can change with other search engines? We will lose the opportunity to choose. Using other search websites, you can’t be so sure whether you get what you need or what has been paid for. The Internet will lose that important balance between ads and the most popular sites. Are you sure that you want to be cheated?
All Google ads are typically relevant to the query that a user makes. A potential advertiser specifies what search keywords he or she would like to have. For example, if you sell used cars in Florida, you can choose a keyword that involves the city in which you do business and the type of your business - "Florida used cards." This makes the advertising useful to an Internet user as well as to the advertiser placing it.
Thousands of companies all over the world use Google AdWords program to promote their goods and services online. It is an excellent way to attract Internet users who can be interested in what you offer. Recent advertisers include such giants as Amazon and Cisco Systems.
Selling ads is a very profitable business for Google. In the fourth quarter of 2008, the revenues of Google-owned sites reached $3.81 billion, or 67% of total revenues. It is a 4% increase over third quarter 2008 revenues ($3.67 billion) and a 22% increase over fourth quarter 2007 revenues ($3.12 billion).
AdWords program has numerous benefits for advertisers. First of all, as it was mentioned above, it is targeted to relevant searches and content pages. Then, the program is cost-effective - advertisers pay only when potential customers click on their ads. One ad costs from a few pennies to a few dollars per click.
Google ads reach a broad audience because they are displayed across Google's growing network of partners that includes thousands of sites from America Online to the Washington Post. It lets companies of all sizes get in front of everybody who uses the Internet.
If one day Google stops working, the advertisers won’t be able to reach a broad audience as efficiently as before. There are just no alternatives to online advertising! Newspapers and magazines don’t have such a broad reach. The effect of television advertising is generally much higher than the effect of newspaper and magazine advertising but TV commercials are very expensive.
Google AdWords main competitors are Yahoo! Search Marketing and Microsoft adCenter. However, they don’t have so powerful system of selling and displaying ads in association with their own search engine, so these advertising programs can’t attract many customers. By now Google has a 75% monopoly for all external referrals to most websites.
Without Google ads, thousands of companies will go out of business. It mainly concerns small firms that do their business online, for example Internet stores. Their target audience is the Internet users, so without online advertising they won’t be able to promote their goods. Of course, they can buy links on large portals, but it won’t have the same effect as Google AdWords has. And what will we have as a result – only giants making business online? Do you really want it?
Google AdSense
If you have a website with interesting content and good traffic, you can get your portion of the revenue that Google gains from AdWords. Have you noticed boxes or columns containing text-link ads on many websites which say "Ads by Google"? This program is called AdSense. You display these ads on your site, and Google pays you for every click on them.
Google can automatically determine the subject of your web page and place relevant ads based on the advertisers' keywords. Such advertisements are considered to be less intrusive than banners. That’s why context advertising becomes more and more popular. According to statistics, aggregate paid clicks, which include clicks on ads displayed on Google-owned sites and the sites of AdSense partners, increased approximately 18% in the fourth quarter of 2007 and about 10% in the third quarter of 2008.
AdSence program is not so profitable for Google as AdWords, but it helps them to increase their profits. In the fourth quarter of 2008, Google earned $1.69 billion through AdSense programs, or 30% of total revenues. It is a 1% increase over third quarter 2008 network revenues ($1.68 billion) ad a 4% increase over fourth quarter 2007 network revenues ($1.64 billion).
Google doesn’t disclose exactly how much website owners earn for each click that customers make. The commission depends on the amount that advertisers pay Google for the particular ad. You will receive a share of that amount - from 2 cents to $15 per click. However, even if Google pays only 20% of their network revenues then it means that the sites owners earn over 1 billion dollars per year.
If Google closes AdSense program, Internet industry can fall into decay. After dot com era end in 1999, Google AdSense program has fueled up the emergence of thousands of new websites. This system offered a simple and reliable way to make money online. Nowadays a good resource can help its owner earn $10.000- $50.000 a year.
Trying to increase their profits, thousands of webmasters spend time and money creating new sites with interesting content. The more people they attract, the more money they will receive. The end of Google AdSense could mean the end of these websites, which will result in ending of dot com era once again.
AdSense program is also important for delivering advertising revenue to small websites that do not have necessary resources for developing advertising sales programs and employ sales people. Without this program, thousands of non-profit sites will be closed just because their owners won’t have enough time or funds to support them.
In addition, Google AdSense is profitable not only for webmasters and websites owners, but for many other professionals working in IT sphere. For example, there are a lot of people who want to share their successful business stories with other Internet users. They create e-book teaching how to make money online with Google AdSense program.
One of the most popular authors who writes on this subject is Joel Comm. He earns thousands of dollars from his e-books. Will he earn the same amount from his “Google AdSense memoirs” or “That good old Google”?
Page rank
Google works similar to many other search engines in its basic principles of operation. It has powerful software programs that explore and analyze web sites. What has made Google unique is that it takes note of how many other pages have links to any given page. It helps Google determine a page's importance, or a page rank.
In general, Google considers a link from page A to page B as a vote for page B by page A. However, Google doesn’t only count the number of links a page receives, but it also analyzes the page that casts the vote. If there are many relevant links to a particular page, it will receive a higher page rank and appear on the first pages of the search results.
Page rank varies from 0 to 10 for each webpage on the Internet. It shows how important this page is in the eyes of Google. Website owners need to receive a good Google's page rank if they want to get traffic to their sites and earn profit. It is a well know fact that 90% of all purchases take place on the first page of the search engines.
There is a special type of business which helps websites raise their PR and get more traffic – SEO. It can be divided into website optimization and marketing optimization. The first one concerns the design, interface, programming, content, and all other website enhancements.
Marketing optimization includes advertising and link building strategies targeted to increase the search results. Famous SEO specialists, such as Barry Schwartz, Aaron Wall, Rand Fishkin and Jill Whalen write books telling about various approaches to SEO. You can also visit conferences or read numerous online blogs on this topic.
If there is no Google, SEO specialists will lose their main source of income. It also concerns people who earn money by trading links and writing websites context. The army of jobless IT specialists will drop the average salaries in this sphere. If you earn $15-$25 per hour, you can get just $10-$15 in future.
And don’t forget that Google employees will be also looking for a job. On December 31, 2008, the company has 20,222 full-time employees. Google spent $890 million in payroll-related and facilities expenses in the fourth quarter of 2008 in comparison with $859 million in the third quarter of 2008.
The sudden death of Google and its Page Rank system would have a devastating effect on the internet business. Every company’s profits correlate very strongly with its Google page rank. If Google dies and everyone starts to use other search engines where they do not rank highly, they could declare bankruptcy very quickly.
Other search engines have completely different systems of determining the page importance, so it is very easy to turn from a huge power in Google to nothing in MSN. For example, nowadays Google gives more weight to off page factors such as IP spreading. MSN pays more attention to on page factors such as density and proximity.
Of course, if your company has a large marketing budget and regular clients, you can keep it afloat for 6-12 months while you are re-optimizing your site for Yahoo! or Microsoft's Live Search. But what if not?
Many companies have already spent thousands of dollars to build a high Google page rank and receive an opportunity to be shown on the first page. If there is no Google and its PR system, than this money is just wasted! The companies will need to find additional funds to promote their websites. It means to cut salaries and fire people.
Due to the reasons mentioned above, Google’s death will affect mainly small and medium-sized companies. Large enterprises and big portals will be easily found in any search engines. If there is no Google, small business all around the world will lose their main marketing tool a good PR.
Gmail
You really don’t have a Gmail account? Are you kidding?
According to the list of 40 most visited subdomains of Google.com, Gmail and Google maps are the most popular Google services. The statistics shows what in November 2008, Web Search (http://www.google.com/) was visited by 126,269,804 unique visitors, Image Search (images.google.com) was visited by 43,023,240 unique visitors, Google Maps (maps.google.com) was visited by 36,914,680 unique visitors and Gmail Google Mail (mail.google.com) was visited by 24,895,354 unique visitors.
Gmail is one of the best free email services in the world. Its main advantage, of course, is 2 gigabits of storage space. That's more space than most other web based email services offer. In fact, when Google announced on April 1st, 2004 that it was giving Internet users a gigabyte of storage, many people thought that it was a joke. At that time, Hotmail from MSN provided just 2 MB of space; so how can a competitor offer 500X?
Besides the storage space, Gmail has a lot of other amazing options and features that attract people. You can set up filters and labels to organize your mail, archive your mail for easier searches, check your Gmail through a mobile phone and get notifications of new messages on your desktop. Google spam filter is considered to be one of the most effective.
No wonder that Gmail is so popular. But imagine what will happen if one day 24,895,354 unique visitors won’t be able to open their Gmail? I would describe this situation as total chaos. First of all, companies and freelancers will lose many clients. Do you keep a list of your partners’ e-mails in a special notebook? Are you sure you’ll be able to find them all without access to your Gmail account? Nobody will be looking for your new contact information – it is much easier to find other people or companies.
Then, the change of e-mail means the change of all business cards and advertising items. You will need to update your website and inform a lot of people about your new e-mail. It means expenses, expenses and expenses.
Then, the average Gmail user doesn’t delete old messages to make room for new. Two gigabits mean a plenty of storage space! So you can lose important documents, invoices and orders that you held in your e-mail.
Google shares
As we have already mentioned above, Google makes most of its profit from online advertising. However, Google's share price is also strong. The company is listed under the ticker symbol GOOG on the NASDAQ stock exchange and under the ticker symbol GGEA on the London Stock Exchange.
According to the Google’s financial report, in the last quarter of 2008 GAAP earnings per share were $1.21 on 317 million diluted shares outstanding, in comparison with $4.06 in the third quarter of 2008 on 318 million diluted shares outstanding. As for Non-GAAP earnings per share, they were $5.10 in the last quarter of 2008, in comparison with $4.92 in the third quarter of 2008.
The Google IPO took place on 19 August 2004. Now its shares are worth over $350 each (to be exact, the price on February, 10 is $358.51). Taking into consideration that their starting price was between $80 and $100 per share, the company’s stock performance is going well.
If Google declares bankruptcy, then the share price will significantly decrease. In fact, the stock itself will become worthless, leaving shareholders unable to sell their defunct shares. Millions of people will lose their investments.
Many companies invest money from IRA accounts in shares. What if your company bought Google shares, and their price became $0? You will lose all you retirement funds.
Google’s death will also cause a significant drop of the stock value of other online companies (for example, Match.com or Sina corp). Do you know how dominoes fall? There will be the same effect.
Investors will decide that if Google, the Internet search giant, is out of business, than smaller companies doing business online are definitely unreliable. So they will try to get rid of their shares. It will lead to great financial losses and even bankruptcies of many Internet companies. Dot com world will be ruined.
Google Foundation
Google is famous for its charity programs. Every year the company commits “one percent” of its equity and profit to various non-profit organizations. Google makes donations through the Google Foundation ($90 million cash donation) and Google.org ($175 million donation).
Google Foundation has already contributed five million dollars to support Acumen Fund, a non-profit company targeted to solve the problem of global poverty. Acumen Fund helps entrepreneurs deliver affordable goods and services to the four millions of people worldwide who live on less than $4 a day.
Google.org includes projects that the company manages itself. An example is the Google Grants program, which places free ads of selected nonprofits.
Google Grants has donated $33 million in advertising to more than 850 nonprofit organizations in 10 countries. The participants include Make-a-Wish Foundation, Doctors Without Borders and Grameen Foundation USA.
If Google goes out of business, many non-profit organizations won’t be able to tell people about their mission and receive help. Maybe it won’t have a large influence on the virtual economics, but of course it will make our world a bit worse. Social problems can be as important as economical ones.
If not Google then who?
It goes without saying that nowadays Google is the most important company on the Internet. It has become something more fundamental than a simple search engine. Which brings up an obvious question: if this search engine goes out of business, who can become “the next Google”? What company can be as important as Google was? There are several versions that are worth analyzing.
People used to live with search engines. If Google dies, many users and companies will look for similar resources. They will recollect that there are other search engines on the planet that appeared even before Google.
The first choice, of course, is Yahoo. Google’s dominance forced this search engine into a second-fiddle role, but it is still a major player. Yahoo search results are also relevant and fast. Plus, it has a wide array of internet services to deal with – Web search, Images search, Video search, Local search, Jobs, Shopping, News, Travel, Maps, Real Estate, Yellow pages, Games, Finance and many others.
One of the main advantages of Yahoo! is their popular Yahoo! Answers. Many people use it because Google doesn’t offer any alternatives. This service is like the second search engine. If you can’t find necessary answers in web, you make a query on Yahoo! Answers. In most cases, you will get several variants of answer from other Internet users.
Yahoo has all chances to become the Internet leader after Google. It has a necessary combination of search functions and useful additional services. However, its main target is to entertain, not to sell or promote goods. Yahoo! lacks some important commercial component that will help sites to survive after Google’s death. Yahoo dominance will turn the Internet from a money making tool to a colorful multimedia center.
The next search engine that has a chance to become “the next Google” is Microsoft Live, or MSN. Its Internet portal, MSN.com, is currently the 6th most visited domain name on the Internet.
What do Google and MSN have in common? Good financial opportunities. Google, with over 8 billion dollars in cash and no debt in its financial structure, can make investments in two main areas: product development and acquisitions. That helps them stay the industry leader. The only other company that has the same financial opportunities is Microsoft, which currently has over 9 billion dollars and no debt in its own financial structure.
MSN Search was launched in the fall of 1998. In 2006 many of its services were reorganized under a new brand name, Windows Live. This move was a part of Microsoft's strategy to improve its online offerings using the widely recognized Windows brand name.
After the launch of Windows Live, the focus of MSN shifted to online news, entertainment, and providing common interest content through its Internet portal, MSN.com. Windows Live offers most of Microsoft's online software and services.
The most popular MSN Services are MSN Search (now called Live Search), MSN Hotmail (now called Windows Live Hotmail), MSN Messenger (now called Windows Live Messenger), MSN Virtual Earth (now called Live Search Maps) and MSN Spaces (now called Windows Live Spaces).
There are also some other small search engines like Quintura and Cuil that call themselves "Google Killers." They are rather simple and don’t have numerous additional services. Of course, without Google they can improve their search software and try to capture more market share in that space. But since a key success factor in the market is providing more than just web search, such small companies will be at disadvantage. No doubt that they won’t become an adequate substitute for Google search engine.
Alternatives to Google Services
As I have already told, Google is not only a search engine that has the majority of the search engine market. It is a large platform that includes numerous free additional services like Gmail, GoogleMaps and GoogleEarth, its main revenue service AdWords with the Pay-Per-Click advertisements, Picasa web albums, the video sharing platform YouTube, Calendar, Notebook and others.
Additional services and facilities make Google the unique resource where Internet users can spend most of their online time. And they are absolutely sure that they are surfing Internet, not Google!
However, dot com world can offer alternatives to nearly all services that Google has. Some of them may not be as elegant as Google's, but if you can’t use this search engine any more, it shouldn't be that hard to start using them.
Plus, keep in mind that without Google’s dominance all these alternative resources will receive a great stimulus to develop and become the leaders in their area.
We have collected some popular websites that can become a good choice in case if Google decides to go out of business.
Google Image Search – Yahoo Image Search
Google News - Yahoo News, Web 2.0, Rootly, MSN news
Google AdWords - Yahoo! Search Marketing and Microsoft adCenter.
Google AdSense – adBrite, Clicksor, Bidvertiser, Chitika, Fastclick
Google mobile services - MSN Mobile
FeedBurner - Zookoda
YouTube- Vimeo, Blip.tv, Rewer
Google Earth and Google Maps – Yahoo Geocities, Yahoo Maps, MSN City Guides, MSN Maps and Directions, GenieKnows
Gmail – Yahoo mail, Windows Live Hotmail
Google Notebook – Zotero, Evernote, Clipmarks, Microsoft OpenNote
Picasa Web Albums – Photobucket
Google Talk – Yahoo messenger, MSN messenger
Google Groups – Yahoo groups, Windows Live Groups
Google Directory – Yahoo Directory
Google Analytics – Mint, Extreme Tracking.
Google Calendar – Yahoo calendar
Google Translate – Fretranslation.com
Google Toolbar - MSN Toolbar, Yahoo Toolbar
Blogger - Yahoo MyBlogLog, Livejournal.com, MSN Spaces
As you see, there is a good alternative to nearly every Google service. Knowing these options you can make your online experience more enjoyable. However, you will need to browse several websites instead of just one - www. google.com.
Final Thoughts
Can you imagine your life without online search engines? I bet not. With the dramatic increase of available information, it has become very important to find exactly what we need. Search engines is the first place to start when we are looking for telephone numbers, addresses, weather forecast, opening times, a person's name, images, flight details, hotel descriptions, currency rates and other data.
According to statistics, an average American opens Google.com over 100 times per week. Our relationship with this website has changes from want to need. We need Google because our life is closely connected with its functions and services.
Thinking about everything that Google does, the company really deserves its leading position. It has become the basis of the Internet world and e-commerce. If one day Google stops working….no, the Earth will not stop to revolve on its axis. The virtual economics and, as a result, the everyday life of many people will considerably change.
As a conclusion, let’s sum up why Google has such a great influence on our virtual and real life.
- Google has developed a great search engine that fulfills one of the most important tasks on the Internet - find exactly what you want within a very small amount of time.
- Google always tries to create simple interfaces that people like.
- Google AdWords lets companies promote their services and products as efficiently as it possible and earn profit.
- Google is the main source of income for many website owners.
- Google PR system caused the appearance of a new branch of IT business – Search Engine Optimization.
- Google spends its profit on the solution of social problems.
- Google offers new creative ideas that other companies would reject, for example providing a gigabyte of space for e-mail.
- Google means Internet for many users.
Do you want to lose it all?
The latest events on the international markets, political prognoses and news headlines make us start thinking – “Will Google survive in this financial crisis? What will happen in the nearest future with all IT industry?” There are many reasons why Google can go out of business, starting from stock downfall to technical failures. Fortunately, the Internet, as an international community of millions of people and companies, will remain in any economical environment. People will always search for information, goods and services. It means that Google has all chances to stay with us for a long time.
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Affiliate Marketing is a performance based sales technique used by companies to expand their reach into the internet at low costs. This commission based program allows affiliate marketers to place ads on their websites or other advertising efforts such as email distribution in exchange for payment of a small commission when a sale results.
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