Google: The World's Most Successful Failure?

David Coursey, PC World Thursday, July 09, 2009 8:30 AM PDT
The amazing thing about Google is how a business that makes 97 percent of its revenue selling advertising has people convinced that it is a technology company. And then gets a free pass despite a series of failures outside its core competencies in search and online ad sales.
Right now, Google seems to be flooding the market with products that are not quite finished. People do not care because the products work well enough and are free. But, suppose people had to pay for them? Then where would Google be?
(See Related: Top 10 Google Flubs, Flops, and Failures
Even though Chrome will be a "free" OS , it will still come loaded on a computer people well be asked to spend perhaps $300 to $400 to purchase. That puts Google under real pressure to perform, something it has never really faced.
Google's Android smartphone OS is well-liked by some and seems to be gaining acceptance, even though its yet to prove itself with paying customers. My impression is that Android will ultimately demonstrate the importance of controlling both hardware and software if you want smartphone success. Apple, RIM, and Palm have that control, while Google and Microsoft do not.
Besides selling ads and providing search results, what successes has Google actually had in the technology space? There's, er, and, uh, and then what? OK, Gmail, but it relies on ad sales tied to content, making it an extension of the core search business.
Gmail does, however, demonstrate that Google is technically more than competent and is capable of real innovation. Nevertheless, its ability to turn innovation into profits remains tied to ad sales.
Based on results so far, there is little reason to believe Google can make its Chrome OS into the world-changer most everyone already seems to believe it will become. It may happen, and I would welcome it, but it is not a foregone conclusion.
Google's applications haven't done terribly well (especially in attracting paying customers), its ventures into selling radio, newspaper, and television advertising have run aground, it's first adventure into operating systems is moving slowly, and now it's going head-to-head with Microsoft on netbooks?
If any other company were doing this, we would say they were daft. However, being the darling that it is, Google's Chrome OS is already being treated as a foregone success.
Maybe that will happen. But, unless Chrome is dramatically more successful than all the Linux-based operating systems that have come before, there isn't a lot of reason to believe Chrome will do more than force netbook pricing concessions from Microsoft. If that.
My hunch is that Google will manage to get Chrome OS onto a bunch of netbooks and then hit a brick wall of unfulfilled customer expectation, at least initially, because the infrastructure doesn't exist to support a mostly web-based computing experience.
The counter argument is that the iPhone has managed to become a real computing platform that, if run on a netbook, could actually get a lot of work done. Provided people are willing to accept its limitations.
So, if you're willing to accept a netbook that is able to do whatever Chrome OS can manage, then you're set. If, however, you expect a netbook to do what your laptop does, only smaller and less expensively, then you will be disappointed and buy Windows instead of Chrome.
The move to cloud-based computing makes a lot of sense and I am a supporter, but still believe a hybrid computing experience that includes both installed and online applications makes the most sense for most users right now and, probably, for years to come.
To me, that says Windows today and maybe another OS someday, but not right away.
Nevertheless, we have to take Google very seriously. By decoupling its technology investments from the need to actually produce profits, Google has an ocean of money to spend in search of its next big thing and little pressure for an immediate return on that investment.
Nevertheless, Google has made a number of bets, only a few of them successful, while many more remain in play. While definitely the most interesting company in technology, Google is not software or online services company in the traditional sense. That is both Google's strength and its weakness.
Tech industry veteran David Coursey tweets as techinciter and can be reached via his Web site at www.coursey.com
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