Google vs Facebook

Why is Google so scared of Facebook?

Google vs Facebook

When you think of the greatest threat to Google, who do you think of? The first thing that comes to many people’s mind is Bing, Microsoft’s search engine. However, in my opinion, Bing is not Google’s greatest strategic threat. Yes, they may keep Google competitive but they are just a slight irritant to Google. The most important strategic threat to Google is actually Facebook.

As I mentioned in “7 Secrets of Tomorrow’s Highly Successful Internet Businesses”, Google is shifting all their gears and aligning all their corporate resources to fight against Facebook with their new Google+ social media platform. This is a major change for Google as they used to give their engineers a lot more freedom in trying out new ideas. Now, social media (Google+) becomes their mandated corporate focus. This is a very telling indicator on how they feel about Facebook.

Now that we have established the fact the Google is indeed seeing Facebook as a long-term strategic threat, the next question is this: why is Facebook a long-term competitive threat to Google? Remember, as I wrote in “How does Google make money if it gives away stuffs for free?”, the crux of Google’s business model is to sell the attention of consumers. For a rival to erode the long term competitive advantage of Google, it must be able to:

  1. Steadily gain more and more attention of consumers
  2. Shut out Google from what gained the attention of consumers

Any strategic competitor that can satisfy these two conditions will undermine and erode Google’s ability to sell access to consumers’ scarce attention. Microsoft’s Bing may be able fulfil the first criteria, but it cannot fulfil the second one. After all, the search engine robots of both Google and Bing trawl in the same playground of freely available information.

To show you how much of consumer’s attention that Facebook had already snatched from Google, all you have to do is to look at this graph from this article at Business Insider:

US share of time spent online
US share of time spent online

The fact is that Facebook is already attracting more attention from consumers than Google.

Today, Facebook has enough market power try out another thing that can ultimately destroy Google’s business model—shut out Google’s search engine. You see, there’s one problem for Google. Their search engine cannot penetrate through the walls of Facebook and catalogue what consumers do inside their Facebook profile. Everyday, hundred of millions of Facebook users post status updates, share pictures, comments on other users’ updates. Now, there is a disturbing trend for Google. As consumers spend more and more time on Facebook, more and more activities are being conducted within Facebook. If this trend is left unchecked, one day, there will be an ‘Internet’ within an Internet in Facebook. That ‘Internet’ can be off-limits to Google’s search engine robots. To give you a better appreciation of how Facebook can shut out Google, consider the following:

  1. Sending messages—today, more and more people are sending messages to each other in Facebook without knowing the other person’s email address. In fact, for many people (especially for young people), Facebook Messaging has supplanted their conventional email communication.
  2. Branding—more and more companies are setting up their presence on Facebook via fan page. For example, Nike has a Facebook page at Notice that Facebook’s brand precedes Nike’s brand. Essentially, this is a brand within a brand. Facebook can easily implement a feature whereby the brand can allow access to certain features of the fan page only to members, which means Google’s search engine is barred from indexing that content.
  3. E-commerce—today, it is possible for consumers to conduct sales transaction at fan page without leaving the entire Facebook environment.
  4. Discussions—you can host entire forum discussion within Facebook. What is stopping Facebook to host blogs, polls, newspapers, forums and other content inside the Facebook environment?
  5. Apps—Facebook can develop its platform further to allow software developers to create highly useful apps so that consumers can conduct transactions and activities without the need to leave the Facebook environment.

These examples are just a small sample of ideas that Facebook can implement to keep consumers within its walled-garden. As Facebook makes its platform more and more useful and fun, consumers will spend more and more time within it, which in turn makes it more attractive for developers and publishers to develop apps and create content that will work within the Facebook environment. Facebook, with its market power, can block Google’s search engine from accessing their environment without fear of repercussion. What if Facebook implement a search engine within its environment?

Then Google has another problem. Compared to Google, Facebook know a lot more about their users because they tend to disclose more highly personal information. With this knowledge, advertisements within Facebook can be much more highly targeted than advertisements on the open Internet (which is Google’s playground). For Google, outside of Google+, personal information can only be obtained through inference. It can only be inferred if Google collate and cross-reference user data across their products and services. This can only happen if Google abandon their “Don’t be evil” motto and make changes to their privacy policy to allow that to happen (which they already did).

Of course, the reality is that such a scenario has not happened yet. But if Google remains asleep at the wheels, one day this will become reality and Google will be consigned to history. One thing in Google’s favour is that it is a far bigger company than Facebook and has much more resources in a fight. It has far more engineers and brains to churn out far more free stuffs (that will of course integrate with Google+) to entice consumers to shift to Google+.

It will be interesting to watch the battle between Facebook and Google unfolds.

About the author

I am a Technology Consultant, whose passion is to help small businesses reach their full potential through mastery of digital technologies, strategies and marketing.