Google naggar Facebook i kanten på mer än ett sätt

I tillväxtekonomin så hade Google inget annat val än att gå in i den sociala sektorn. När man redan har över 90 % av sökmarknaden på många marknader så måste man helt enkelt bredda sig om man ska öka användandet. Google+ har inte krossat #Facebook , men +Eli Fennell skriver här bra om hur Google ändå, bit för bit tvingar Facebook att göra justeringar som i längden biter dem i svansen när det kommer till deras enda intäktskälla, dvs annonserna.
Tipstack till +Mats Halldin

Reshared post from +Eli Fennell

How Google+ Devalues Facebook

Competitive brands stay ahead of their competition in the consumer market by finding ways to both build the brand, and undermine the competition at the same time. For Google, undermining the competition often takes the form of undercutting their margins.

Google has shown a willingness to run projects at a loss, often for many years, in order to grow their market share and the lay the groundwork for future profitability.

YouTube, for example, only recently began to generate profit, but now looks set to become a multi-billion dollar, media-reinventing powerhouse. Gmail forced competing email services to offer larger storage for free. Google Drive has already altered the pricing structure for cloud storage. Android is conquering the world while generating little revenue.

They seem set to repeat this pattern with Google+. Google+ is two things, a social network, and a social layer for the Google ecosystem. The latter may or may not generate profit, but the former clearly does not. How could it? There are no advertisements, no ways to spend money directly, nada. It's not just that there aren't any advertisements… it's that there seems to be almost no space for them to be added in the future.

With bigger pictures and videos, longer character limits and the text formatting abilities to encourage its use, and everything else that Google crams onto the page, the screen real estate for advertisements is basically absent. Google+'s new User Interface seemed to correct this by introducing a massive area of "white space" visible on widescreen monitors.

Yet, Google has indicated that it will not use this space for advertising, and in every other respect the new User Interface removes basically any screen real estate for future advertising. Nor does it offer any sponsored posts (yet).

The new Google+ iPhone app repeats many elements of the new User Interface, including bigger bolder pictures and videos, taking up valuable screen real estate on devices with less to begin with. The Android app will also be updated to something closer to the new iPhone version before long (with some "extras", apparently).

Google is an advertising company, and a social network is valuable real estate for advertising. What's going on here? Are they smoking some bad granola out there in Mountain View? I don't think so. I think this is a deliberate strategy to utterly devalue Facebook by forcing them to compete on features or go too far plastering ads everywhere.

In the most direct way, this devalues Facebook by forcing it to spend more to stay ahead. Less directly, they are trying to force Facebook to choose between two unattractive alternatives: continuously increasing the amount of real estate it devotes to advertising while Google+ remains ad-free, or continuously decreasing that real estate to compete on features.

When Google introduced Hangouts, Facebook had to integrate Skype. This helps Microsoft, but (when used) tends to take user eyeballs away from Facebook's advertisements. The cost of running Hangouts, and Hangouts On Air, must be quite large, and yet Google offers them free, without any advertising. And because Google+ offered bigger bolder pictures, Facebook had to offer them as well, eating away even more screen real estate.

What did Google do in response? They made pictures and videos even bigger and bolder in their new User Interface, too big and bold for the liking of some people. Will Facebook follow suit? How much would this further reduce the real estate they have available on the screen? What about mobile apps? If they are forced to compete on cramming features into their mobile app with Google+, their mobile advertising revenue may be permanently starved.

Google is making social networking, while still valuable for marketing purposes, essentially valueless for paid advertising. Their hope, I believe, is that eventually Facebook will either try to cram so many advertisements onto the page and into the News Feed that users opt to switch to their ad-free alternative, or will be forced to remain largely ad-free in perpetuity, effectively choking the revenue stream.

I, for one, don't think a social network should be used as a captive audience to sell advertisements. Facebook has to do this. They have no other revenue source. Luckily, Google doesn't need to make money from Plus any time soon, may never need to. Social networking without all of the advertisements? Now that really is "more like real life", and less like the world's largest Tupperware Party.

◄ #facebook #googleplus #whitespace ►

Where's the Advertising Space? Nowhere!

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