29 thoughts on “Why I Like Google’s Reorg & Why It’s Only a Start”

  1. “what they need are “creatives”
    Yep, yep, yep – Been beating that right-brain thing in my Twitter stream for quite some time – As Job’s says, the intersection of computer science and liberal arts.
    Not sure Page will ever understand that though.

  2. According to the article: “They are all engineers and most (if not all) of them have a proven track record as product people….” Really??

    Gundotra while he was at Microsoft was never responsible for product development, rather he was Microsoft’s version of Guy Kawasaki: an incredibly slick, charismatic Evangelist for .NET. Never was he responsible for product division P&Ls. When he was hired by Google at such a senior “Engineering” role, many execs at Microsoft laughed their heads off. Granted: a brilliant coup on his part. But an incredibly poor reflection of Google’s perspective on actual experience vs. showmanship.

    Even were this to be false or bombastic (which I’d still challenge anyone who has worked in the exec ranks at Microsoft to dispute), Gundotra’s lack of “proven track record” as a “product person” at Google is clear. He was never “in charge” of Android development, although he promoted the image that he was. Maybe in charge of the Google Campfires and glitzy developer conferences. But I challenge anyone to provide evidence of his product development expertise.

      1. Om

        You mention product people .. What do you think about the lack of Marissa Mayer’s name? I thought she was a very important part of the Google ecosystem yet she is not mentioned in the reorganization at all.

  3. rem. IBM & Microsoft, everyone feared them. Google’s core DNA is search, and they will never ‘get’ social networking like FB. similarly, FB will throw money and try to catch the next wave, whatever it is, and likely fail b/c it’s a social networking company. the cycles of dominance just keep getting shorter.

    1. Hard? No, it’s done well as the only smartphone on Verizon but absolutely no numbers have been reported since iPhone became available. Both Apple & Verizon report later this month so then we’ll see what the effect is.
      And, android is really only a credible phone, Apple has a whole complete platform built around iOS/OSx and Google is having a hard time keeping up.

      1. I don’t think they have a hard time keeping up. They are as behind in tablets as they were in smartphones when Android launched. I agree they should try to do more things “first” instead of always being 18 months behind Apple, though. I think Google TV was such an attempt (Apple TV doesn’t really count, especially the old one), but they didn’t get it right from first try. They should’ve focused on ARM chips from the beginning for lower costs, too, and I hope they will do the same with Chrome OS/.

      2. Yes but Lucian, the tablet market and the handset market are two entirely different animals. The iPad is more like iPod/iMac with totally different distribution channels and most importantly, no subsidies. And, apps are even more important. So, android is way behind in tablets in every aspect.

    2. Android isn’t kicking iPhone to the curb at all. You are confusing market share with profitability and they aren’t the same. Remember, Android is open source, as an OS it doesn’t earn much money in the bigger scheme of things, the purpose of Android for Google is as an advertising vehicle. Of all the handset makers Apple is by far the most profitable, by orders of magnitude. In fact only HTC is really healthy on Android sales. Motorola Mobility is in deep financial difficulty and have predicted that next quarter’s revenue will be down. LG is barely breaking even in smartphones. Sony is also struggling to break even as a phone maker. Apple takes in something like 45% of all mobile phone revenues and their profit margin on the iPhone remains quite healthy. Apple’s y/y revenue from iPhone alone is $38 billion compared to Google’s advertising revenue from Android at $1 billion y/y.

    3. Apple’s complete platform built around iOS/OSx hasn’t halted the iPod sales decline, nor helped Apple’s ebooks effort (is there still one?) against the Kindle platform, nor enabled Apple’s video/TV hobbies to dent Netflix.

      Apple won’t sustain its very recent levels of profitability as the network effect of the dominant Android marketshare makes the Apple iPad and cashcow iPhone irrelevant. Apple had to be bailed out by Microsoft when it lost the desktop to Windows, and Apple just lost mobile to Google.

      1. That paltry $150M Microsoft investment didn’t exactly “bail them out”. Are you aware that Microsoft invested $200M in Best Buy during that same period and that’s never portrayed as “bailing” out BBY. Microsoft got something for both investments. The sub story is they got off the hook for blatantly stealing Quicktime code. What Apple did need however, more than the $150, was a Microsoft commitment to Mac/Office and that got that.

        Where is that “dominant” android marketshare other than possibly in handsets in the U.S.?

  4. Oops!! productivity tools for corporates, Google Apps, etc all gone with the wind ? I thought big money was still in the cloud. Guess it wants to shower only on the Bald Man in Redmond 😉

    Android – Great Effort, Go Kill Others.
    Ads & Search – No competitor yet. Cheers!
    Social – Use Engineering Talent and not a +1 button for Spammers and if you expect people to Login to Google and Rate +1, Good Luck. Just wondering, why can’t Google write a Search Application on Facebook so that you can index a user & his friends’ data and let him be able to search.
    YouTube – IMO, this is your Social. Think 🙂
    Search – Weed out the Spammers because your Happiness lies here 😉

  5. Om wrote: ” the next generation of Google products that focus on “finding” us stuff we want.”

    I have no idea what the above statement means. As far as I know, Google is doing a fine job of helping me and everybody else in the world find what we want. Often within seconds. And it looks like there will be no competitor (more about this below) who will come close to touching Google for many years to come.

    What do you mean by finding what we want without the Google search box? Do you want to go to Google.com and have it automatically guess what you might be looking for BEFORE you enter a search term? I wish you’d be more clear about what exactly you want from Google. What “disruption” are you experiencing in Google search right now? As it stands now now, this article sounds like so much esoteric incantation. It doesn’t have the typical Om Malik clarity.

    Apple is rocking Google? Last I checked, Android (just ONE of Google’s products) was busy stealing Apple’s lunch. And, Google didn’t even have to manufacture or market real phones in order to do so. It just supplied the software and other companies around the world are falling over themselves to help Google beat Apple. The best part about this story? Google doesn’t even WANT to beat Apple. Apple is so insignificant, it is just becoming collateral damage to Google’s objective of providing people an easy way to access its products and services through mobile devices. Get it? Apple is just collateral damage to Google, not even a real competitor.

    FB is ripping Google apart with raging winds? What a joke! FB will NEVER catch up with Google in helping me find stuff I want. Just a few minutes ago, I was looking for a Spanish movie whose trailer I had seen, but did not remember the title. All I knew was the basic premise of the movie. I asked Google and got the answer. The day FB can do this, I will eat my shoes. I can tell you this – almost NONE of my friends on FB or any other social network would have known the answer. Even if they did, I wouldn’t have been able to find it from them as quickly as I did from Google.

    1. Appreciate some of your points but I like the tone of OM’s post. Disruptive is not more of the same and Google should be disruptive in its mindset and new products.

    2. Very valid points, This article seems to be written by some hate blooger like MG Siegler or M Arrington rather than respected journalist like Om Malik. The Apple and facebook parts were the funniest, i cant imagine how you might think Apple is damaging google, when google search is the default on all apple products; and facebook is a social network, not a search engine.

  6. I don’t agree, OM. “Organising the world’s information” may have been a convenient talking point at one point but Google, like any company is about revenue. Google became a huge money spinner because it perfectly caught the disruptive wave in advertising as advertising shifted from TV, magazines and newspapers to the web. On that front its now being seriously challenged by Facebook and soon Twitter. But advertising money is again being disrupted and this time to the mobile web. Unfortunately for Google the pot of ad money hasn’t increased but where that money is spent is shifting from the web to mobile. And unfortunately for Google the competition it faces in mobile advertising includes Apple (Quattro), Microsoft (Screentonic), Millenial, Nokia (Enpocket), AOL (Third Screen Media) and others so while the advertising pie isn’t growing by leaps and bounds, the competition is.

    If you look at the reorg, the areas of responsibility tell you about areas where Google hopes to increase revenue (they’re a company not a religion). All of those are still about advertising. The markets (stocks) don’t believe that Google can go grow without a fresh revenue stream and thus its stock is actually down over the past 12 months.

    The current reorg tells us what Larry Page thinks is important in his vision of Google. He has defined the playing fields, we can expect more social, more Chrome, more Android, more video but can Google maintain their powerful grip on advertising and more importantly grow beyond it? That surely remains a troubling question mark.

  7. Before Google’s rise, I remember thinking what a powerful company Yahoo was, and how it seemed unassailable.

    Now Yahoo is a relic of its former self. The same could happen to Google.

    People habitually use the same search engine, which keeps them coming back, but they don’t actually have much loyalty to any search engine. That’s why Google was able to overthrow Yahoo. If something clearly better came a long, people would leave Google and go to it (Bing is not yet clearly better).

    So Google’s empire is built upon a mere algorithm. That’s an unstable foundation.

  8. Excellent. Only thing I’d add is that while “this SVP is not a real person” could be true, the company should learn to envision a very real person experiencing Googliness at the very center of all it does. This is the hallmark discipline of great and enduring sales+service orgs. Organizing the world’s info for the benefit of a living, breathing, enriched and grateful individual is a different experience –with greater psychic rewardes– than merely organizing information for the sake of it.

  9. “Today’s Google is like a leaky, aging supertanker that’s being rocked by rough seas (Apple) and being ripped apart by raging winds (Facebook).”

    That’s a bit melodramatic…it isn’t fitting either, Google isn’t leaking or bleeding market share. It isn’t what you would call a supertanker in terms of company size. If Google rules in social and the mobile market too, that would be too powerful for a company. I don’t know why people expect Google to dominate in every market they enter. If they don’t dislodge the current market leader immediately, it’s a failure. You guys own Google stocks or what? why are you so anxious to see them taking over the world?

    1. Eric,

      Google stock has been going sideways for a long time. They need to show how they are going to grow beyond search. While they have good possibilities (Android, Chrome, etc), they have largely failed at all other efforts (Buzz, Wave, etc). I am a Google stockholder and like the company. But Apple and Facebook are both eating Google’s lunch, and will continue to do so unless Google refocuses on key businesses and gets out of this conquer on all fronts mentality.

      1. What lunch are you talking about? Hardware is never Google’s business. Adsales are. And facebook revenues, even the ones not official are a very small fraction of search advertising. In online advertising, social networks are by far the worst performing.

      2. @rdx,

        I am sure you are not arguing that social is the biggest threat Google has faced in their relatively short history. As to your point about revenues in search, they will decline as less people visit the search engine.

        Case in point, and a very small example: there was a cricket world cup final a few weeks ago, and while normally I would have gone to Google to check scores, I did’nt have to because all my FB friends had the scores plastered all over my wall. More importantly, it led to some engaging conversations, in my core social circle. It was a good experience, and one I consider better than the one dimensional search I would have done on Google.

        Do I need to search for other things? Absolutely. Has FB affected how I use search? Definitely. Will this affect ad revenues down the line? You tell me.


  10. Om,

    While I agree with your post in general, I think it’s a mistake for a founder to retake the reigns once they let go.

    Larry Page’s coming back is akin to Jerry Yang’s taking over at Yahoo, and we all know what happened. Successful founders as CEO’s never let go of the reigns (ala Gates, Jobs, Ellison, Benioff, etc). Zuckerberg is in the same camp and while he has someone running the operations, he remains in control. Most importantly, these other folks learnt the pitfalls of wearing the crown AS their company grows, not when it’s a near monopoly already.

    To put this in your axiom, how can one be a captain of a supertanker, when they’ve never run a speedboat. And engineering/making a speedboat is not the same as running and handling it.


  11. They need a site/concept called street-cred. AKA Google should create a concept of who is who long term in cybershapce.

    Here me out. They need to place people in a pyramid of who is important and who is noise. Then listen to the non-noise people.

    I am sick of Amazon, Google, Paypal not giving a shit about me.

  12. @Raj,
    “I think it’s a mistake for a founder to retake the reigns once they let go. ”
    So you didn’t agree with Steve Jobs come-back either then? 😉

    All those comparing Android revenues with iPhone – it’s a mistake to do so, as you know Android is only the mobile OS so could only be compared with Apple iOS, hence the problem with this approach.
    Instead, compare revenues between iPhone and all the phones running Android.

    As to the main article implying Google “can’t think beyond PageRank” I’m sure they are trying and will come-up with something, but to be fair, has anyone else come-up with something better?

    1. Vincent,

      Steve Jobs did not leave Apple by his own volition. He was kicked out. Gil Amelio devotes a whole chapter in ‘On the Firing Line’ on how Jobs approached Gil as soon as the latter was elected to Apple’s board. He always wanted to come back. If he had a choice, he would never have given the top spot.

      As another example, Howard Schultz has done an amazing job turning around Starbucks. BUT he was always the CEO and when he detached, things went south. So he retook the reigns and the rest is history.

      The founders who become successful CEO’s have always held the reigns from the get go. They do not let someone else run the show for 10 years and then come back to the top spot. And in cases this has happened, it has not worked out so well. That’s my point.


  13. Excellent analysis from Ohm, but is it too late for the juggernaut that Google has become to stop, re-evaluate and change course? Have many companies as large as Google accomplished this task?

Leave a Reply

Your email address will not be published.

This site uses Akismet to reduce spam. Learn how your comment data is processed.