Skip the navigation
News Analysis

With OS project, is Google over-extending itself?

The move could be a master stroke or a colossal blunder

By Juan Carlos Perez
July 8, 2009 06:15 PM ET

IDG News Service - Google's decision to build a PC operating system could be a master stroke or a colossal blunder, depending on whether the company has the resources that such an ambitious and long-term undertaking will require.

Google plays in a variety of extremely competitive markets, serving a broad scope of demanding customers and partners. Although developing an operating system could yield big rewards, it could also distract the company and make it more vulnerable to rivals.

Of chief concern is Google's continued reliance on a single type of advertising for most of its revenue, despite efforts over the years to diversify its business.

Google still makes most of its money from search pay-per-click text ads, a market that it dominates but where loyalty from consumers and marketers is thin, making the company vulnerable to the development by a rival of a significant technology breakthrough.

In short, if someone built a better search mousetrap -- as Yahoo, Microsoft, Ask.com and a host of smaller players are trying hard to do -- Google would suffer a sudden drop in search usage and consequently advertising, crippling its finances.

Google's attempts to build alternative revenue streams from display advertising remain nascent, despite the costly acquisitions of ad services provider DoubleClick and video-sharing leader YouTube, two properties Google considers key to this effort.

Bold initiatives to provide print ads to newspapers and spots to radio stations both failed. The company continues its attempts to build a TV advertising business.

Google executives are the first to admit that the company dominates the Internet search market because it toils long and hard every day to continually improve its engine technology.

Yet, not content with waging battle every day in search, Google also provides enterprise search and business collaboration software, competing against the likes of Microsoft, IBM, Cisco and Autonomy, and trying to win over business managers, IT managers and CIOs.

As if that were not enough, Google has set out to court Web application developers by opening up APIs to a wide variety of its consumer and enterprise products.

In addition, Google maintains many non-search services for consumers, such as the Orkut social network, photo management service Picasa, Reader feed manager, Knol encyclopedia, Checkout online payment system and the iGoogle personal home page.

In recent months, Google has shut down or stopped supporting several products, including Google Video, Google Notebook, microblogging service Jaiku and mobile social network Dodgeball.

"My feeling is that Google needs to stop announcing things and instead execute on completing them," said Rebecca Wettemann, an analyst at Nucleus Research who focuses on enterprise software.

For instance, Google could make many enhancements to Apps, its hosted collaboration and communication suite for businesses, which just yesterday had four key components exit the beta, or test, stage, she said.

Reprinted with permission from IDG.net. Story copyright 2010 International Data Group. All rights reserved.
Additional Resources
Forrester Consulting - Optimizing Users and Applications in a Mobile World
WHITE PAPER
Solving application issues over the WAN requires careful consideration. Based on their independent research, Forrester Consulting offers recommendations on how to tackle application performance issues, insufficient bandwidth and the inability to quickly restore users in a disaster.

Read now.

Security KnowledgeVault
WHITE PAPER
Security is not an option. This KnowledgeVault Series offers professional advice how to be proactive in the fight against cybercrimes and multi-layered security threats; how to adopt a holistic approach to protecting and managing data; and how to hire a qualified security assessor. Make security your Number 1 priority.

Read now.

Cut Communications Costs Once and for All
WHITE PAPER
New IP-based communications systems are being deployed by small and midsized businesses at a rapid rate. Learn how these organizations are enabling faster responsiveness, creating better customer experiences, speeding office or mobile interactions, and dramatically reducing existing communications costs.

Read now.

Operating Systems White Papers
VMware View Optimization Guide for Windows 7
This document provides guidelines for configuring a standard Windows 7 image to be used within a VMware View™ environment, providing administrators with the...
Watson - A System Designed for Answers. The future of workload optimized systems design
Watson is a workload optimized system designed for complex analytics, made possible by integrating massively parallel POWER7 processors and DeepQA technology. Read the...
Overcome Top 7 Admin Challenges of Active Directory
As Active Directory's role in the enterprise has drastically increased, so has the need to secure the data. Gain insight on creating repeatable,...
Insiders Can Ruin Your Company. Take Action.
Did you know that 80 percent of threats to an organization come from the inside? The threat from insiders is often overlooked in...
Top Solutions and Tools to Prevent Devastating Malware
Custom malware frequently goes undetected. According to Forrester Research, the best way to reduce risk of breach is to deploy file integrity monitoring...
All Operating Systems White Papers
Operating Systems Webcasts
Optimizing Networks for the Cloud
Join guest speaker, Rohit Mehra, IDC Director of Enterprise Communications Infrastructure, to explore current trends, discuss best practices for optimizing Data Center and...
Apps QuickStart Series Part 2: Designing and Deploying SQL Server on VMware vSphere
Download this webcast to learn about the design considerations for virtualizing SQL workloads, performance and scalability information and high-availability options, as well as...
Apps QuickStart Series Part 1: Designing and Deploying Exchange 2010 on VMware vSphere
Download this webcast to learn the virtual hardware design considerations for Exchange 2010, deployment using the building block approach, options for high-availability and...
Customer Spotlight: How IPC The Hospitalist Company Implemented Oracle on VMware
Have you been looking to hear about customer's experiences with the new VMware vCenter Site Recovery Manager product? View this webcast to learn...
Virtualize Business-Critical Applications with Confidence
Virtualizing business-critical applications has become a key focus for organizations as they move along their virtualization journey. With the launch of VMware vSphere®...
All Operating Systems Webcasts
Newsletter Sign-Up

Receive the latest news test, reviews and trends on your favorite technology topics

Choose a newsletter
  1. View all newsletters | Privacy Policy
IT Jobs