This major shift demonstrates that the computing platform is transitioning from the desktop to the web. Microsoft's Windows division reported revenue of $3.808 billion in the quarter ended June 30. During the same period, Google posted revenue of $3.872 billion. Microsoft's Windows has an operating profit of $2.8 billion or 74% profit margin while Google's operating profit was $1.1 billion or 29% profit margin. Microsoft is projecting revenue growth of 9-10% in the Windows division this fiscal year and Google has been growing at 60% so far this year.
Google, which did not exist when Windows was introduced, is powering ahead and innovationing in many areas that Microsoft once ruled. Microsoft as a company still generates more money than Google, $50 billion versus Google's $14 billion. However, what is significant is Microsoft makes most of its money from licensing software while Google makes most of its revenue from advertising. Google is rolling out products that directly compete with Microsoft's core offering and a new generation of users are embracing Google's hassle free model where as Microsoft has had trouble making inroads into Google's strong hold in search and advertising.
Microsoft is trying to expand beyond its core Windows, Office and Server Tools business and into online services including search and advertising. Google is also making head way introducing onlines productivity solutions, mobile services, and data services that offer an alternative to Microsoft's offerings.
Google has acquired high resolution aerial photography camera company to boost Google's mapping service. Google's mapping technology power popular products such as Google Earth, Google Maps and it is a key piece of Google Local and Google Mobile services.
Mike Arrington, broke this news. Appartenly, people the world over we shocked upon learning this. According to Arrington, AXcess News is a legitamate newspaper and is a member of the esteemed Online News Association, which purports to be a serious group of online news sites. The president of the ONA is Kinsey Wilson, the Executive Editor of USAToday.com.
Google (NASDAQ:GOOG) is willing to bid at least $4.6 billion for wireless airwaves spectrum being auctioned off by the federal government. Google wants the FCC to mandate that any winners lease a certain portion of the airwaves to other companies seeking to offer high-speed internet and other services.
It is part of Google's larger initiative to offer wireless access to open up the marketplace for its onlines services. It will also give consumers a third option besides cable or telephone companies to get high-speed internet or broadband access, thus lowering the prices for internet access. Google's position puts it at odds with major telecom carriers such as Verizon Wireless(NYSE:VZ) and AT&T (NYSE:T), both are expected to be bidders.
Open network access would allow consumers to buy the wireless device and software of their choice and use it on the new network. In a letter to the FCC Google's CEO Eric Schmidt said, 'In short, when Americans can use the software and handsets of their choice, over open and competitive networks, they win.' Jim Cicconi, AT&T's vice president for external and legislative affairs, said Google would now have to 'put up or shut up.'
Google reaffirmed that the company is interest in the game industry is limited to in-game advertising. This is an area that Google believes will have tremendous growth over the next number of years. In-game advertising is expected to exceed $1 Billion by 2011, from about $78 million last year. Google got into the space via the acquisition this year of game advertising company AdScape Media.
"We are not going to be a publisher or a developer or a portal for games, at all. That's the jobs of everybody here. That's why we want to partner with you", said Bernie Stolar.
Publishers will be able to use the Google to put advertising in their games, and collect revenue. Advertisers, in turn, will be able to work through Google to buy ad space within games. A Google representative said that it will start with ads in Web-based games, with plans to move into PC and console games later on.
Yahoo's second-quarter profit fell 2.3% from a year earlier. Google continued to lead Yahoo in search market share, Facebook and MySpace continued to erode Yahoo's strong hold in display advertising.
This is the sixth straight quarter in which Yahoo's profit has declined as a result of diminishing share of the search market and display advertising to competitors.
To counter this Yahoo introduced Panama, an advertising program designed to make advertisers' Web links more relevant and more likely to be clicked and Right Media Inc. to handle online-advertising auctions.
About 40% of Yahoo's revenue comes from selling search-linked ads, the four- line text spots that appear next to search results, and from display advertising, which includes banner and video ads.
Soon passengers's on Virgin America will be able to know where they are thanks to Google. Virgin America, announced that Google's map technology on all seat-back computer screens. Passengers will be able to locate where they are, how far they are from their destination and how much time is remaining in the flight, in addition to being able to pan and zoom at eight different levels.
You can now place ads on your mobile websites using Google AdSense. It's an internet marketer's dream. AdSense has traditionally been used on the desktop platform only allowing site owners to display related advertising on their site using a PPC model. The mobile edition is a limited availability beta release. It's no secret that the mobile market is hot with increasingly more people owning cell phones and an ever growing number of mobile websites being created to support this sales opportunity. AdSense is paving the way for the monetization of this new marketing channel by covering the bases on another of the much touted three screen views.
On the user experience side, this can equally be a designer and user's worst nightmare. Although screen sizes are increasing in size, there is still a very limited amount of screen real estate to work within and now with more content, albeit ads-y content, which may or may not be welcome by users. It's an interesting challenge both in the decision to serve ads and the usability implications. The placement of the ads are unlikely to fall in the right column as is traditionally the case on the desktop platform; they are more likely to fall towards the bottom of the page above the site footer with some differentiation between the main site content and what are essentially ads. There are apparently character and line limitations.
In terms of development, website requirements are that "webpages must be written in a mobile markup language and developed with a server-side scripting language such as PHP; AdSense for mobile ad code will only display ads on mobile-compliant webpages. Mobile Webpage Markup Languages: wml (WAP 1.x.), xhtml (WAP 2.0), chtml (imode, etc.)". (Source: https://www.google.com/adsense/support/bin/answer.py?answer=71600&ctx=sibling)
After, Eric Schmidt said that Google will vigorously fight Viacom's $1B lawsuit against YouTube, Sumner Redstone changed his tune saying, "The Google people are intelligent people. They can live peacefully with companies like Viacom." Why would Google even want to engage into an agreement on a dying businees model that will eventually kill Viacom? In fact Schmidt went on to say that, "Viacom is a company built on lawsuits ... look at their history". Schmidt also pointed to the fact that Viacom was currently being run by a former general counsel of the company, Philippe Dauman. Redstone confirmed to reporters of such when asked of Schmidts' comments, "We have engaged in a lot of litigation at Viacom, of which I have been a primary mover."
Why is litigation the cornerstone of Viacom's business model you ask? Simple, Viacom is getting squeezed by content producers and distributors. The traditional distrubtion channel for Viacom's product is shrinking. Users' are moving to more targeted and personalized mediums on the internet eg. YouTube. Technology has lowered the cost of production of content and there is more choice that ever and more competition for eyeballs. Viacom's is still operating under an old production and distribution structure which is bleeding the company. So the easiest thing to do is to blank others for your problems. Frankly, Viacom should be happy that users' are keeping its products alive by putting it on YouTube and introducing it to new audiences, who might end up watching it on TV thanks to YouTube.
Hot off the research block, the Pew/Internet Research Group has published a report yesterday which indicates that China's internet population of 137 million is growing at a faster rate and is expected to outpace that of the U.S.'s of 165 to 210 million in a few years. This is not suprising considering the population of China which is at 1.3B compared to the U.S.'s at 300M.
There are many implications of this notwithstanding the impact on site globalization requirements for more and more companies wanting to do business in the lucrative Chinese market. The upside is that the "Chinese share a single written language, despite the multiplicity of spoken tongues..." (Source: Pew http://www.pewinternet.org/PPF/r/218/report_display.asp). What is potentially trickier is understanding the social, political, and cultural nuances in the usage of language translation, color, metaphors, and imagery. I also recently read somewhere that China is expected to surpass India in the outsourcing arena as well.
Travel search engine SideStep announced the acquisition of social networking site TripUp.com.
User's visit TripUp.com to gather current information from locals and fellow travelers who act as destination gurus with reviews about restaurants, attractions and places to party. Users also can find trip buddies to plan their travels and members share travel video, journals and photos.
“As travelers look for more information, the best way to get at it is through social communities and social networking,” Rob Solomon, president and CEO, told Brandweek. “The editorial content that is out there in guidebooks is great, but the information is finite.”
SideStep also purchased travel review aggregation site TravelPost. All three sites will continue to operate independently for the time being until their functions are absorbed into SideStep.
I see Google entering the space that Zillow, Trulia and a few others own right now. I am basing this on an article in the San Jose Mercury. Google already has most of the piece in place. It is a matter of packaging and branding at this point. You can read more here>>.
Last nite, I attended the Google Web Group Open House where Dennis Hwang, the official Google Doodler, presented on some of his work over the past 7 years at Google. He is a fine arts major and started with the company as one of its earlier employees. He explained that Sergey and Larry were looking to have a logo doodle created just before they took off to their annual pilgrimmage to Burning Man, and someone mentioned that he was a fine arts major, and they asked him to create it. They had created the very first doodle themselves. For one of his initial logo designs, he requested of Sergey and Larry to purchase a dozen or so stock images. Sergey apparently said no citing the $100 a pop as too expensive and suggested that Dennis take to the parking lot with some bread and a digital camera to photograph the resident pigeons. Dennis did but later realized that Sergey mistook the doves in the parking lot for pigeons. Sergey eventually allowed him to buy only one image.
Google creates holiday logos for all its country sites which are around 158 or so. He also showcased some of the logos which never made the cut for various reasons such as the possibility of offending someone, innacurate depiction of something, or simply cannibalism as in the case of the one depicting a snowman eating his own nose like a snowcone.
Google apparently receives a lot a feedback on their logos from people who have issues with a logo. Geo-specific holiday logos are created for the specific country site only. For instance, French only holiday logo would not be placed on other country sites. As Dennis pointed out, it is sometimes challenging to come up with original creative ideas for the same holiday year after year. He now shares his doodling duties with another designer. See also http://googleblog.blogspot.com/2004/06/oodles-of-doodles.html.
I recently wrote about the Paypal and CheckOut rivalries. It turns out Paypal in making some serious head way. Today, Southwest Airlines is letting travelers buy their plane tickets with PayPal.
Southwest said that customers buying tickets on its Web site can use debit and credit cards or bank accounts linked to their PayPal account. Southwest officials said offering PayPal as a payment option was a matter of convenience.
In addition to Southwest Airlines, Northwest Airlines announced a similar deal with PayPal last month.
PayPal was started in 1998 and purchased by eBay in 2002. It lets people send and receive payments electronically without disclosing financial information. Last year, PayPal processed more than $38 billion in payments.
The service faces new competition from Google Checkout as an online payment system.
According to the Mercury, recent surveys found that less than one out of five users of Google's Checkout online payment service were happy with it and eBay's PayPal figure was more than double that (two out of five). In May, about 33 people visited PayPal's Web site for each Checkout visitor, up from an 11-to-1 ratio in December, according to Nielsen/NetRatings.
At Searchnomics 2007, Google CheckOut claimed that 25% of all online transactions originate via search. Even if half that number is true, then there is a threat to Paypal's lead over CheckOut. In 2004, both the companies' had annual sales that were almost equal. However, revenue at Google tripled to $10.6 billion last year, while eBay sales increased 82% to $5.97 billion. According to comScore, Google had 120 million visitors in May which was 51% more than eBay's in the same period.
Google's Advantage Google is the most used and recognized search engine on the planet. Google is leveraging its advantage in search and advertising to complete the checkout flow for online payments. Google's strategy is to chip away at PayPal's leadership. Approximately 40% of Paypal's transactions orginate on eBay and some of these products compete with third party vendors. Previously, these vendors did not have much choice but to use Paypal as a payment system on their web sites. CheckOut provides them an alternative. Also, with CheckOut there is no holding of balances. It is an automatic overnight deposit to your bank account, where as on Paypal, a request has to be made for a deposit and it takes 3-4 days at best.
Paypal's Advantages PayPal is the most innovative and recognized web payment service ever. Paypal has the benefit of a large marketplace via eBay. Presently, eBay does not allow CheckOut on its properties. PayPal's service, generated a fourth of eBay's revenue last year and it has become increasingly important as auction sales growth slowed to 23% in the first quarter, half that in 2004.
Google is using Checkout as another tool to further entrench its search and advertising platform. PayPal is a profit and growth center for eBay. To secure its lead Paypal should move quickly to integrate itself as the online payment system with other major search engines such as Yahoo, AOL, Ask, MSN, Amazon to name a few. Alternatively, Google could open up to third party payment systems like Paypal and let the user decide which payment service to use. This way the market decides the winner.
Google just announced the acquisition of GrandCentral, here is the link to the official blog post.
GrandCentral develops solutions for managing voice communications. Its services allow users to integrate all of their existing phone numbers and voice mailboxes into one account, which can be accessed from the web. This is similar to what OneBox now OpenWave was doing. Google will use GrandCentral's technology to deliver services that enhance the collaborative exchange of information between users.
Here is an explanation of the GrandCentral service GrandCentral offers features that complement the phone services you already use. If you have multiple phone numbers (e.g., home, work, cell), you get one phone number that you can set to ring all, some, or none of your phones, based on who's calling. This way, your phone number is tied to you, and not your location or job. The service also gives you one central voice mailbox. You can listen to your voicemails online or from any phone, forward them to anybody, add the caller to your address book, block a caller as spam, and a lot more. You can even listen in on voicemail messages from your phone while they are being recorded, or switch a call from your cell phone to your desk phone and back again. All in all, you'll have a lot more control over your phones.
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Here is an explanation of the GrandCentral service GrandCentral offers features that complement the phone services you already use. If you have multiple phone numbers (e.g., home, work, cell), you get one phone number that you can set to ring all, some, or none of your phones, based on who's calling. This way, your phone number is tied to you, and not your location or job. The service also gives you one central voice mailbox. You can listen to your voicemails online or from any phone, forward them to anybody, add the caller to your address book, block a caller as spam, and a lot more. You can even listen in on voicemail messages from your phone while they are being recorded, or switch a call from your cell phone to your desk phone and back again. All in all, you'll have a lot more control over your phones.
