I'd like to take a moment to thank Rich "Topix" Skrenta for his recent post about Google, and how they've come to rule the web era of computing. Thanks to Rich, I no longer have to fumble my way through my own posts, clumsily attempting to explain why I believe Google will always whip Yahoo!, and all other pretenders. Rich has done it with considerably more clarity and force than I've been able to muster:
Google has won both the online search and advertising markets. They hold a considerable technological lead, both with algorithms as well as their astonishing web-scale computing platform. Beyond this, however, network effects around their industry position and brand will prevent any competitor from capturing market share from them — even if it were possible to match their technology platform.
To paraphrase an old comment about IBM, made during its 30 year dominance of the enterprise mainframe market, Google is not your competition, Google is the environment. Online businesses which struggle against this new reality will pay opportunity costs both in online advertising revenue as well as product success.
Competitors such as Yahoo should quickly move to align themselves with this inevitability. Yahoo could add an extra $1.5B to their revenue overnight by conceding monetization to Google and becoming a distribution partner for Adwords, as Ask Jeeves did.
So, if you find yourself, as I have, temped to explain Google's dominance using phrases like "a broker between users and resources," or "new advertising platform," then do yourself a favor: stop. Just point people to this post and move on.
Tags: Google, Rich Skrenta