Sunday, 18 September 2011

Three times Google’s ‘strategy’ got in the way of success: Skype, GDrive, Google+

I just finished reading Sriram Krishnan’s excellent post 'Don’t be so f*king strategic' and couldn’t stop thinking that this must have infected Google as it had Microsoft.

Here are three times when the public learned of missteps of Google that were somehow related to a grand strategy of the company:


This is documented in Steven Levy’s book ‘In The Plex’ and the author has a more specific blog post on the issue. What is comes down to is this: Someone at Google thought, and was able to convince the higher-ups, that peer-to-peer is old technology, not consistent with their cloud model, so Skype was worthless to them. The fact that this someone was from a product group that would have to compete with Skype internally goes unmentioned, but what is important is to see that Google in 2009 passed up the opportunity to buy Skype for a fraction of what Microsoft paid for it in 2011. Skype is now integrated with Facebook.

GDrive / Dropbox 

Drew Houston worried in his YCombinator application that Google would launch GDrive any day. It turns out Google didn’t and Dropbox is a billion dollar company today. Why? In The Plex has this to say ( The Google Docs team was able to convince the higher ups that files didn’t make sense in the cloud. File systems were a thing of the past and so GDrive was abandoned almost complete, the engineers sent to work on Chrome. It turns out that files aren’t quite as dead yet, and Google Docs itself now allows you to upload them. Recent rumours say that GDrive may have been resurrected and is getting launched, this time in a much more crowded space with credible independent competition.


The latest news is that Google+ is showing signs of decline. The causality here is not as strongly established, but the early demographic has not been happy with their real names policy. When I found out they were enforcing this policy, I was in disbelief. Surely when you’re entering a new market, you want to be friendlier than the competition, you want to be welcoming to those who were disenfranchised from your competitor. Google proceeded to shoot itself in the foot by affecting other services that the blocked users were on, shutting out ethnic groups that did not have names with a western structure, people who are known by a name that is not their legal name, as well as those who preferred to remain anonymous for security reasons. The statements coming out of the GooglePlex were to the effect that 'Google+ is not for everyone', and that they can't fight all the battles all the time. This is bizarre behaviour on its face, and I've learned that when smart people behave in ways which appear outright incompetent, there's usually higher level considerations at play. It turns out that Google sees Plus as an ‘identity service’, a part in a grand strategy we’re not privy to (but can make guesses about). To put this in plain terms, Google is jeopardizing their bet-the-company move to attack a competitor because they have some masterplan that may or may not be what users want in the long run.

This is three times when Google let their ‘strategy’ get in the way of success as far as we know. I’m sure more are known to the insiders. I hope this has documented what I’ve been seeing watching one of my favourite companies display a fondness for footguns. Here's my unsolicited advice to Google: Stop being so f*cking strategic and just focus on building the world’s coolest technology, what people love you for, before you end up boring like facebook.


Anonymous said...

Skype is not worth $8.5 bn, it's capabilities are not novel. Google open approach of WebRTC is the right disruptive move here.

GDrive is about files in the cloud and the cloud is beyond files so their vision for is correct.

G+ is a long term play, it's too early to and conclude anything about it, their numbers would appease any startup and any other company and it's yet not visible to all users and integrated. so it's too early to assume anything.

h said...

How do you see G+ being a "bet the company" move?! Google makes its money off search and display ads, not social networking. I do not buy that Facebook is taking enough of the entire ad market to threaten Google's existence; nor do I buy that Facebook will be dominant forever.

Anonymous said...

Internally, google calls it 'strategy tax'. Its no coincidence you can't login using facebook to any of google's products. (Despite many users wanting to be able to do that)

Alexandros Marinos said...

@anonymous: I quite like the term 'strategy tax', cheers.

diet pilss said...
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