Google flexes financial muscles to fix 'tarnished image'

Web 1.0's big winner is playing catch-up with Facebook in a Web 2.0 world, observes analyst who adds that jury is still out on whether Google's acquisition spree will result in an attractive social platform that users will migrate to.
Written by Kevin Kwang, Contributor on

The lack of an effective social media strategy from search giant Google has "tarnished its image a bit", but Web 1.0 's big winner is now trying to buy its way to being a significant player in the Web 2.0 era, says a Forrester Research analyst.

Augie Ray, senior analyst of social computing for interactive marketing professionals at Forrester, told ZDNet Asia that while no one knows exactly what Google is planning, it seems evident that the search giant will enter the social media space with a "much larger and integrated offering". This is based on its recent acquisitions than its past efforts at creating a social platform.

In the past few weeks, Google has splashed cash on companies such as virtual currency software developer Jambool as well as social media startups Slide and Angstro. On Tuesday, the search engine operator announced the addition of mobile game developer SocialDeck to its list of acquisitions.

The buying spree came after the company pulled the plug on its real-time collaboration project, Google Wave, which aimed to combine various forms of online communications based on its e-mail platform Gmail.

Going by these developments, Ray noted that rather than launch independent tools and services such as Wave and Buzz, a collaboration tool targeted for communication with friends and entertainment, "the time has come" for Google to make a cohesive social media platform a vital part of the consumer experience.

"The acquisitions hint that gaming will be a part of the Google social media offering, but I expect we'll see a [more] robust and cohesive offering from the search company," he added.

User privacy will be key
To wrest market share from Facebook, Ray said Google will have to target Facebook's privacy woes. He noted that the social-networking site has been in the spotlight recently due to repeated privacy concerns and platform updates, which have left consumers "uneasy".

"When Google launches its social platform, the product [has to be] perceived as easier, [attract less attention from privacy advocates and regulators], and be more relevant, trusted and favorable toward consumer privacy," he suggested.

Another analyst, Claus Mortensen, gave his assessment of Google's efforts in the social media space, saying that the lack of a social-networking platform to challenge Facebook is the search giant's "one major Achilles' heel".

That said, the principal for emerging technology research at IDC Asia-Pacific's practice group told ZDNet Asia in an e-mail that Google has realized its launching a similar service to compete directly with Facebook is "not feasible". Instead, the search engine giant has chosen a different strategy for its social media efforts.

Elaborating on the search giant's social media strategy, the IDC analyst thinks the Wave project was canned to evolve Gmail into a more social network-like offering that is focused on online collaboration.

Google could also be planning to make use of its Android operating system (OS) and Chrome OS to target social gamers, Mortensen noted.

He said that with its Android OS getting a "good install base" on mobile phones, its plans to go into the tablet PC space in the coming years, as well as a vibrant Android Market ecosystem, these factors should put Google in a "good position to succeed with the gaming aspect of social media".

When quizzed on its social media strategy, a Google spokesperson said the company was "committed to making the Web more social, including helping third-party sites add social functionality and giving people new ways to interact within their own products".

These include existing offerings such as Gmail, Docs, Blogger, Picasa and YouTube as "strong social elements" that help people find more ways to share information, he noted in an e-mail.

However, he pointed out that "[going] social is an ongoing project" and the company is still focused on making Google's services socially aware in a "seamless and integrated way".

He cited the acquisition of Slide as an example of the search engine operator's efforts to bring in the necessary talent to build "new and better ways for people to share information and interact online with others". Similarly, its Jambool buy will be a "valuable asset" as the company improves on its e-commerce products, the spokesperson noted.

Facebook eyes lucrative search pie
Meanwhile, Facebook is not sitting idle while Google encroaches on its area of influence.

The social-networking site launched its Facebook Questions product in July this year, albeit in a limited beta test environment.

According to a ZDNet Asia report, about 1 percent of Facebook users will have access to the Questions feature. This offering will allow users to ask a question from a new "question dashboard"--the profile publisher that lets members update their statuses--or through the search box.

Forrester's Ray stated that this search index feature plays right into the social media company's strengths. "As consumers share ever more information about the products they like and the places they visit, Facebook users can often discover the information they need without visiting a search engine," he said.

The analyst went on to qualify his statement, saying that while search engines such as Google will not be "made obsolete", the changes in consumer behavior around search and discovery are "creating an ever more urgent need" for the search giant to create a viable and helpful social media strategy.

Furthermore, the social media company had earlier in August purchased 18 patents involving social-networking technologies from Malaysia-based payments company MOL Global--the firm that bought over Facebook rival Friendster--according to a ZDNet Asia report.

In the report, it was stated that Facebook may choose to defend the patents aggressively from any Google products that start to veer into similar territory.

"Taking social-networking market share away from Facebook won't be any easier than Bing and Yahoo wanting to steal search market share from Google," Ray noted. "Google has the most to gain and lose depending on consumers' acceptance of its new social platform."

To IDC's Mortensen, the developments that these two Internet companies are making can only be beneficial to both them and Net users.

He said Facebook's foray into search, for instance, could "revolutionize the social media landscape" and how the technology is used by companies, political organizations and individuals seeking to influence public opinion.

"Both companies have strengths and weaknesses in their positioning in the social media landscape. But the developments we're seeing in the market should benefit both companies as they expand their service offerings and move to become truly ubiquitous service providers," said Mortensen.

Facebook did not reply ZDNet Asia at press time.

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