Google and the art of disruption

The giant of Silicon Valley

There are very few companies that have changed the way the world works. Ford Motor Company was one such company in the 20th century. It introduced low cost cars to the American market with stupendous success. At a time when owning a car was a luxury beyond the reach of the average American, Ford’s Model T bridged the gap and started a new era of affordable automobiles.

On the same lines, in the 21st century there have been certain technology based corporates that have altered the way the system works. Google is one such immensely powerful company. It is the world’s most visited website with an ambitious goal to “organize the world’s information”.

Disruptive Technology

Wikipedia describes disruptive technology as:

an innovation that helps create a new market and value network, and eventually disrupts an existing market and value network (over a few years or decades), displacing an earlier technology.

Google, in its capacity as one of Silicon Valley’s giants, has been at the forefront of disruptive innovation. Google does not think and function on the same lines as that of an average tech based company. The concept of disruption has been at its core business strategy. Does it sound far-fetched? Not really. Let us analyse.


As of 2013, the net revenue of Google was USD 59.82 billion. Around 90-95 percent of it was derived from Adwords, its golden goose in terms of revenue. In the past, when search engines like Yahoo were charging potential advertisers with hefty amounts to publish ads, Google came up with an innovative idea of Cost Per Clicks. According to this method, an advertiser has to pay only when his ad is clicked by the internet user. This idea sounded the death knell for many upcoming online advertising portals and effectively ended Yahoo’s reign as the most popular site for advertising.

Not only the C-P-C method sounded fresh and economical, it also contributed to the aesthetic look and feel of the search results pages. While Yahoo and other sites looked ridiculously cluttered with flash banners and popping ads, the clean interface of Google was refreshing. Since then, Adwords has grown on to become the primary source of Google’s revenue. This has allowed the company to be financially secure and constantly experiment with path breaking ideas.

The important aspect to note here is Google’s strategy to eliminate competition by introducing a risky yet disruptive business model. Though it is an altogether different issue that the model clicked perfectly, it highlights the way Google thinks.


On August 17, 2005 Google acquired Android, a mobile software company for USD 50 million. Two years later, Google offered to give away the newly developed operating system for free to device manufacturers. A consortium of companies called the Open Handset Alliance was formed and the OEMs (Original Equipment Manufacturers) were exempted from paying any royalties for using the Android software.

Considering the market situation back then, it was shocking and sounded insane. Why would a company invest millions on a product for two years and yet give it away for free? During that period, Symbian and windows mobile operating systems were the dominant market players and were very well established. Competitors like Nokia and Microsoft shrugged off the impact of Android’s introduction and its threat was considered as null. Yet, Android is the most widely used operating system in the world today. For every iOS device being activated, in comparison there are three Android devices in the world. It has also pushed the once popular Symbian operating system into complete oblivion. As of 2013, Android owns 78.9 percent of the market share, a huge lead over Apple’s iOS, which is a distant second at 15.5 percent.

The important question to ask is : why did a search engine giant invest so heavily in delivering a mobile operating system? For starters, it wasn’t because they wanted to diversify their sources of income. It practically gains nothing from Android when compared to its other income sources.

Here comes the interesting part: Google realized that the world was swiftly transitioning towards mobile based searches. The percentage of users using mobile devices for searches showed an upward trend and this was a worrying factor for Google. It wasn’t imperative that a mobile user would always access the Google website for a web search. Google would lose huge amounts of search related data that is necessary to generate user specific ads. It needed a native application on the phone to facilitate quick and hassle free web searches and also accommodate its growing number of services such as Google Maps.

Thus, the entry of Android into the mobile hemisphere was significant. With an open source API and a large base of developers contributing to its app store, Google could lure users into buying android based devices and yet subtly enforce their services upon them.

Protect the golden goose

The final equation in every move Google makes ultimately strips down to one single entity: the web search. All said and done, Google is an internet search engine company and majority of its revenue comes from search based advertising. With the wide usage of Android devices, at Google’s disposal is a huge database of user data that can be used to generate user specific ads and deliver better results to the advertisers. With location based and personal data about each user being recorded at Google’s servers, it is literally an information goldmine. The more accurate the user specific ads, better the advertising performance and ultimately better revenue.

It is fascinating to know the lengths to which Google can go to safeguard its principal entity : the web search. In order to maintain dominance in the area of web searches, it has even launched the flagship Nexus brand of smartphones and tablets. An attempt to demonstrate the power of Android and reinforce the faith in potential customers.

Not just Android, potentially every move Google makes is to safeguard its dominance in the area of web searches and advertising. Be it Google Maps, Google Docs, Google News or the other multitude of services that are offered for ‘free’, they all add the enticement factor and keep the users hooked onto their ecosystem. This is market disruption to a new level. A stroke of genius driven by astute business thinking and strategy.

But then again, Google was never your average tech company and it never will be. To quote an article headline:

Disruptive innovation is not a tactic. It is a mindset.

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Goodbye, Little Light Box

Only 90s kids will get this is one of the more common edicts pillared across the internet. Image macros of Walkmans, Swat Kats, and the ever menacing Furby dolls stay true to ensure the integrity and legality of this rule of law. Video clips of NSYNC and Seinfeld are regularly circulated just so that the internet reminds itself that yes, it is indeed, the 90s kids who get it. The fondness for the decade, which was well endowed with parachute pants and a thinner Mariah Carey, stems from a multitude of good reasons apart from the two listed previously in this sentence. Keeping today’s society under the lens, it’s easy to note that the majority of the workfoce-without-work enjoyed the best years of their life during the very same decade. The ill-fated children of the baby-boomers saw their lives head up the roller coaster, up into the clouds, at the very precipice of the steep fall that was to come.

Recent studies, however, indicate that the last of the most loved decade ever is now 14 years past the present day. As natural trends would have it, it is not long till a new generation, with their own tribulations find themselves reeling and yearning for the days of old.

From what is known, this has probably begun.

Just as floppy diskettes eroded towards mainstream obscurity and VHS morphed into a rare collector’s item, the point and shoot camera has become no more than an unnecessary electronic home and travel appliance, if it’s ever bought that is. With a growing industry of mobile photographers and an already established network of DSLR enthusiasts, the need for an intermediary photography unit is at a steady decline. From a purely technical point of view, the only visible intermediary per se would the toxic combination of teenagers, SLR cameras and Facebook accounts.

The point and shoot digital cameras were a marvel in its heyday as they provided casual means for photography. It was lightweight, compact, travel friendly and easy to use. It provided amateur photographers such as your every day Japanese tourist a way to make a running gag out of themselves on the internet. The first few camera phones, as hyped as they were, proved to be very diminutive competition for the little light box. The grainy VGA cameras embedded in the phone’s body accomplish very little as far as compelling a consumer to give up their cameras were concerned. At the same time, the market was rife with activity, innovation, and vaguely made advertisements as Sony-Ericsson and Canon began to launch high end point and shoot units.

Japanese Tourists
Courtesy Yuval Haimovits

And then, entered the duopoly of Android and iOS, putting an end to the peace and stability. They weighed even lighter, were more compacter, more travel friendly and easier to use. The effects of the two operating systems were not exactly as direct as one would imagine. The pictures taken with these phones were initially quite underwhelming but the amount of things that could actually be done with the pictures allowed the smartphone to claw its way up the technology ladder. As the quality of the pictures got better, the idea of networking with them surfaced. People could now take a picture, add some filters onto them as they please, put them up on a social network or just intimately send it to a friend. The traditional 2000s camera could take the first of the above steps and it would just as much end right there.

The trusty point and shoot was once a staple for capturing the happy moments of birthday parties, casual family nights, road trips and general every day events. Now though, this little light box is something which only the ‘00s kids will get.


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Facebook Home: the new ‘it’ ?

Google’s Android has become the mobile operating system every one unanimously loves. It is the next generation of portable personal computer, or maybe not. The one disadvantage in Android bugging every smart-phone-maniac is its inability to run multiple apps at once. On your old-school desktop PC you can Skype chat, run a couple software updates while waiting for your browser to load. But in your smartphone you would have to sit with your Facebook app while it downloads the zillion notifications in to your news feed. Well, not any more.

Facebook Home

That’s were Facebook Home comes in, Facebook Inc.’s newest release of your favorite app. Facebook Home is a family of apps, that puts ‘your friends at the heart of your phone.’
OK, translating from geek to English, Home updates all your FB notifications, messages and chats on to your screen even when you are using other apps. To top it all, it also allows you to chat with multiple friends through Facebook simultaneously.
Doesn’t sound like much? Wait for it.
Cover Feed displays a stream of posts on to your screen as soon as you turn on your phone. In Facebook’s words, “it puts the spotlight on whatever friends are sharing now—photos, status updates, links and more.”
Notifications on calls, events and updates stick around on your screen till you deal with them.
Annoying much? But here’s the good part: you can swipe away the one’s you are not interested in and keep the ones you want.
Chatting with your best friend while you catch up on last night’s game is good,but chatting with all of your friends simultaneously is better. Facebook Home lets you switch between chat windows with just a click on your friend’s profile picture on the screen.
But the best part of Facebook Home is the app launcher. It keeps all your favorite apps in one place, personalizing your system even more, truly making you feel at ‘home’.

Everything sounds great, waiting to download the new cool app? Sorry to disappoint, but here’s the bad news. While it is open for free download from Google Play, it can only be used in HTC One X, HTC One X+, Samsung Galaxy S III and Samsung Galaxy Note II. This substantially shrinks the potential market for the app.

With the changing licensing rights on mobile apps, it should be possible for all smartphone users to have a taste of Facebook Home soon enough. Dearest Apple fans, hang on in there..

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