Google’s Plans for Mobile
With the new rumors circulating about a Google phone I’d like to take a chance to talk about Google’s mobile strategy, what works and what doesn’t make sense.
Not long after rumors of a Google phone, Google’s CEO Eric Schmidt began talking about the validity of these rumors and the plans Google has for mobile. Google’s core revenue stream comes through monetization of search results by selling advertisements against each search. They’ve failed to move into radio advertising, have had marginal success selling TV spots, with their second largest revenue stream coming from their syndicated content network which operates similarly to display with a dose of relevancy driven through contextual ad mapping. With news of their plans for mobile, Google enthusiasts were excited, but others began to wonder why Google would depart from their core search advertising model, but why is Google focused on mobile phones and a mobile operating system (Android).
Google’s Mobile Strategy
Expand Reach of Current Ad Programs: With the change over the last 3-4 years that has seen a wide shift away from lightweight browsers that strip out images and css to phones (crackberries, iPhones, G1, etc…) that give a nearly identical experience to your computer’s web browser. This means that Google can sell/place the same ads on your mobile phone that they sell/place on your computer. As more users increase their web usage (searching for restaurants or like while on the go) the more ads Google sells and the more money they make.
Accelerate Mobile Adoption: With the iPhone as the original choice for smart phones it helped increase adoption slightly but nowhere as quickly or as broadly as it should have. This was a result of the high price tag of the iPhone (initially $800) and a requirement to be on the AT&T/Cingular network one of the smallest 3G networks. In an effort to increase the breadth of adoption, as well as to make it more cost effective Google bought the Android operating system with the acquisition of Palo Alto software company. Now the Android operating system is on more than a dozen phones (usually less than $250) across 3-4 mobile networks. Even recently Motorola’s ‘Droid Day‘ was celebrated with an ad on the home page of Google. By working in conjunction with cell phone makers and mobile networks Google has been helping to make mobile access cheaper and more available to everyone.
Sculpt the Mobile Landscape: With the iPhone being the leader in providing an experience most like a PC browser they had the most control over mobile user experience. While Google wasn’t necessarily hoping to change the user experience they did want to make sure that competition would ensue so that the users needs were highest priority as well as the speed of innovation would increase.
On top of all these other items Google has also made sure they provide a market for applications that are monetized either through direct purchase or, wait for it…, advertising. Guess who is the largest provider of application advertising, Admob. Google announced last week that they have acquired AdMob. Along with their application based advertising, Admob also brings with it 15,000 other large mobile advertisers to extend Google’s mobile publishing network.
Google’s past strategy and their movement over the last week continue to show that mobile is important for Google and one large focus for them moving forward.