Google is as Google does

I'm not a smart man, Violet. But I do know what revenue is.
Written by Jason Perlow, Senior Contributing Writer

Our Violet is clearly angry. Very angry.

While I empathize with Violet over her experiences with Google+ and how the social network has been managed, I also wish to point out that Google co-founder Sergey Brin admitting to the audience of the Re/Code conference, which is made up of the richest and most powerful people in the technology industry, that his personal involvement in Google+ "was probably a mistake for me to be doing anything tangential to social to begin with" is not at all uncharacteristic of the way Google has been conducting itself since, well, forever.

I don't wish to be in the position of having to defend Google for its business practices, as I work for one of its competitors and I don't agree with many of the things that they do.

I encourage people to look for alternatives to Google products and services for any number of reasons. 

But in this situation the only thing I can offer Violet is, paraphrasing the immortal words of Forrest Gump,

"Google is as Google does."

If you are going to use Google's services, then you also by definition have to accept that you are going to reside within that ecosystem and Google has the right to manage it and manipulate it as they see fit, in order to maximize revenue.

To understand why Google is as Google does, you have to understand their revenue model, particularly as it compares to their industry competitors. 


This graphic comes from my colleague Ed Bott's excellent piece from back in February of 2014: Apple, Google, Microsoft: Where does the money come from? 

I suggest you read Ed's article because it makes the motivations of all three of these companies crystal clear.

Apple makes its money overwhelmingly from consumer electronics.

Microsoft makes its money, currently, overwhelmingly from the business and consumer licensing of software and services.

Google as a company defines its culture of innovation as throwing stuff up against the wall until it finds something that sticks. Or, to put it in another way, something that brings in more advertising than it costs to run.

Google? As you can see above, pretty much from advertising revenue generated on Google's website properties and with AdWords text ads placed elsewhere, including in mobile apps for Android.

That little tiny chunk that says Motorola Mobility? That was recently sold to Lenovo, so if we were to redraw that chart, the percentages under "Google Websites" and "Google Network Members Websites" increase a bit.

In short, after the Lenovo transaction is complete, over 90 percent of Google's revenue will come from advertising.

Revenue generation through advertising in the age of the Internet is a complex science. Google and Facebook have both had to become masters of this in order to maximize their revenue because virtually all of their income comes from advertising.

Microsoft, Yahoo and Amazon, to a lesser extent, also have to do this for those properties that are reliant on advertisting revenue. But not at the scale of Google or Facebook.

When a property or a service isn't performing the way they want, they have to tweak the recipe. That means affecting the user base generating the content which, in turn, affects the way the advertisements are generated and targeted.

So stuff like our privacy that Violet is upset about? A distant second to keeping the revenue generation machine well-oiled. 

Sergey Brin revealing they might have to throw the baby out with the bathwater because it isn't working out and Vic Gundotra going to greener pastures is typical Google.

They have always done things this way, and there is no indication they will do things any differently, based on how the company makes its money. 

Violet writes "With Google+, it became clear that we were all little more than webs of flesh spun over packages of saleable data."

Really? I was pretty convinced of that the second I signed up for a Gmail account ten years ago. But I understood the tradeoffs.

It's their nature.

How many Google properties have been deep-sixed because they were lousy performers? I don't know. Let me Google that for you.

At any point in the lifetimes of these products that no longer exist, you had angry users. They got stung. Google Wave begot Google+, and I suspect something else will replace it.

Google as a company defines its culture of innovation as throwing stuff up against the wall until it finds something that sticks. Or, to put it in another way, something that brings in more advertising than it costs to run.

The end-users of those services, both those that survive and those that are abandoned, become part of Google's living science experiments.

It isn't the model I would choose if I were Google and Sergey Brin, but hey, I'm not a billlionaire; it's a model that is working well for them financially. 

So to Violet I say, you have a choice. Don't get in one of those driverless Google cars unless you are prepared to go where it takes you.

Do you empathize with Violet? Or are you along with with Google for the ride? Talk Back and Let Me Know.

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