Gemini 1.5 is a cutting-edge AI model developed by Google that has revolutionized the field of natural language processing. With its massive size and advanced architecture, Gemini 1.5 sets new standards for contextual understanding, opening up a wide range of possibilities for real-world applications.
Key Features:
Massive Size: Gemini 1.5 is one of the largest language models ever created, with 175 billion parameters. This immense size allows it to process and retain vast amounts of information, resulting in unparalleled contextual understanding.
Contextual Reasoning: Gemini 1.5 excels at understanding the context of a conversation or piece of text. It can track complex relationships between entities, events, and concepts, enabling it to answer questions and generate responses that are highly relevant and informative.
Long-Term Memory: Unlike previous language models, Gemini 1.5 has the ability to retain information over long periods of time. This allows it to maintain a coherent understanding of a conversation or narrative, even after many turns.
Few-Shot Learning: Gemini 1.5 can learn from just a few examples, making it highly adaptable to new tasks and domains. This reduces the need for extensive training data, making it more accessible for a wider range of applications.
Benefits:
Enhanced Search: Gemini 1.5 can power search engines that provide more accurate and comprehensive results by understanding the context of user queries.
Conversational AI: Gemini 1.5 enables the development of chatbots and virtual assistants that can engage in natural and informative conversations, providing personalized assistance and support.
Content Generation: Gemini 1.5 can generate high-quality text, including articles, stories, and marketing copy, that is both informative and engaging.
Language Translation: Gemini 1.5's deep understanding of language allows it to translate text and speech with greater accuracy and fluency.
Scientific Discovery: Gemini 1.5 can assist scientists in analyzing large datasets, identifying patterns, and generating hypotheses, accelerating the pace of scientific research.
The recent comment about #gemini has inspired me to explore the possibility of recording the audio of my entire day and storing it for future reference. This would allow me to ask questions about my day to a model, such as #ChatGPT, which could potentially fill in the memory from my environment.
One of the key advantages of Gemini is its ability to fit the entire day into its context window. This means that it could potentially process and store a continuous stream of audio data, providing a comprehensive record of my daily activities, conversations, and experiences
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By leveraging the capabilities of Gemini and other AI models, we could potentially create a standard feature that allows users to store and access their daily memories through natural language queries. This would be a transformative tool for productivity, self-reflection, and personal growth.
For example, imagine being able to ask your AI assistant:
"What did I talk about with my boss this morning?"
"Can you summarize the key points of my meeting with the client?"
"What songs did I listen to on my commute home?"
"Did I forget to do anything important today?"
Such a feature would not only provide a convenient way to recall specific events, but it could also help us identify patterns, track our progress, and gain valuable insights into our daily lives.
While this technology is still in its early stages of development, the potential applications are vast. By combining the power of AI with the ability to capture and store our daily experiences, we can unlock new possibilities for self-awareness, productivity, and personal empowerment.
Gemini 1.5 is a transformative AI model that sets new benchmarks for contextual understanding. Its massive size, advanced architecture, and long-term memory enable it to process and retain vast amounts of information, answer complex questions, and generate highly relevant responses. With its wide range of applications, Gemini 1.5 has the potential to revolutionize industries such as search, customer service, content creation, language translation, and scientific research. As the field of AI continues to evolve, Gemini 1.5 stands as a testament to the power of deep learning and natural language processing, opening up new possibilities for human-computer interaction and advancing the frontiers of human knowledge.
The tech behemoths Amazon, Microsoft & Google are established players in one of the battes that will change the future of customers view and investments of computing. This is an area with a potential hundred billion dollars plus that can be secured for the vendors – a lucrative space that each one wants to corner : the cloud. For a quick recap of the dollars under consideration - read here. Cloud lets business tap on demand the processing, storage and software over the web. Tall, powerful and cool servers with gargantuan memory onboard installed inside enterprises now are gradually giving way to tap on need model –use when needed and shut them down in other times. The vast data centers and governance brought in by these tech behemoths make them ideal partners for business to tap such services on a need to have basis – whenever and wherever required.
Amazon is by far the well-established leader here with a revenue that far exceeds the combined revenue of all competitors put together. Amazon partly achieved this by bringing a single-minded focus to this space to scale up and win and it paid back handsomely. Amazon’s first-mover advantage coupled with slow reactions from competition has now made Amazon an almost insurmountable lead in business in this space. That’s the focus and attention of the next two players. Microsoft has been pushing Azure extensively last 2-3 years and clocking impressive success. The lesser known of the trio in this space – Google is now flexing its muscle and is now focused on striking it big here.
Google is recognized primarily as the early proponent of cloud computing – after all, Google built huge date centers in its early days and ran services like search, gmail and maps , available around the world and with unthinkable scale in action. Alongside, developers build other applications on top resulting in an expanding google universe. Google has the strong reputation of running scalable, secure services and recognized as one delivering successfully for a long time. By being late and remaining indifferent to this space, Google lost out on big time opportunities that were out there and Amazon happily grabbed these. Now, Google wants to get back aggressively and be counted as large player in this space and is increasing its investments, market messaging and outreach efforts. Last week the company hosted an event to talk about their upcoming plans around the Google cloud platform and talk loudly about some notable success that they have notched thus far. I listened to the webcast and followed the announcements keenly to see how Google is planning to move things here and I heard good actionable things.
Google’s overall messaging shows that the momentum in the business continues and the focus to scale this platform with enterprise as a key segment to focus on for adoption. Google positioning is getting better to take a sizable chunk of business in the ever growing public cloud space over the next few years. The overall market is projected to have 50% of the enterprise workloads moved into overtime. Google paraded customers/customer stories – the likes of Spotify, Coca-Cola, Disney etc. as proof of successful adoption of their services.
The emphasis on a move forward basis is positioned around:
A. Machine learning as a cornerstone of their approach and hence drive the attendant benefits for customers.
B. Monetization/Commercialization of native security tools used within Google to make these available to customers.
C. Make ease of deployment and migration more easy.
In terms of upcoming innovation, consistent with its focus on enterprise adoption, Google talked about the lofty vision of No-ops goal for enterprises. This will be an ideal demonstration of the power of cloud computing and if Google and others are able to make it happen everywhere, it’s a true sign of the changed paradigm here.Another important facet of the evolution of the cloud revolved around the extreme emphasis on machine learning and the Google cloud platform’s leverage of this. A new product called Tensorflow has been open sourced by Google and it is their core belief that embracing machine learning will become a non-negotiable for innovative startups focused on scaling globally and offering sophisticated services.Add into the mix cloud monitoring tools working across clouds – enterprises can hardly resist massive cloud adoption with these. And in order to keep helping enterprises adopt and scale faster, Google wants to focus on the three important aspects of cloud computing – data centers, security and containers.
I drilled into these a little more to find what could be differentiated in offering such services and what I could recollect from the conference webcast included the following, which Google finds as the drivers for increasing enterprise adoption of their services.
1. Better value: GCP can cost up to 50% less than competitors. Google provides automatic discounts as customers consume higher volumes. And GCP also offers custom machine types (i.e., cores or gigabytes), which helps save customers versus static instance types from other vendors that often lead to overprovisioning.
2. Accelarate innovation: Google’s approach here is to allow customers to run applications with no additional operations staff needed. For example, Google showcases Snapchat here - grew from zero to 100mn users without hiring an operations team (just two people).
3. Risk Management : Google shall be focused on providing best-in-class security for customer’s data and digital assets, protect privacy and help in conforming to compliance and regulatory needs.
4. Open Source adoption –leading to better management by customers for products like Kubernotes( focused on managing data containers).
I got the feeling that the GCP was comparable to Amazon’s fabled AWS services for the purpose of enterprise adoption. While the engineering and under the hoods battle is one part of the equation, the real determinant of success and also ran lay in shaping market forces – GTM, Solutions, Partnerships, support and ease of doing business – an area that Google will have to heavily focus on. With Google’s stated plans to triple their data center regions and with some good early demonstrated success, the market should begin to warm up for Google.Enterprise success depends not just on what’s available from a service provider – determination of what and how to move to cloud, transforming IT landscape, flipping over the governance model and change management – all these have a say in the eventual success of any cloud initiative. With substantial progress and focus on this space with the tech giants competing aggressively for their pie in this fast growing space, the competition expands the market, services get more sophisticated and yet mature fast and the industry improves and courtesy of Moore’s effect, the customers get superior services at a lower cost. It’s a win-win situation for all.
A few hours back today, Google launched an ambitious effort to make search faster for all . In the process they have laid the foundation for a new version of SEO to take roots. Lets look at the details here.
"Google Instant is a new search enhancement that shows results as you type. We are pushing the limits of our technology and infrastructure to help you get better search results, faster. Our key technical insight was that people type slowly, but read quickly, typically taking 300 milliseconds between keystrokes, but only 30 milliseconds (a tenth of the time!) to glance at another part of the page. This means that you can scan a results page while you type."
Marketers and SEO professionals cant ignore this .. "Smarter Predictions: Even when you don’t know exactly what you’re looking for, predictions help guide your search. The top prediction is shown in grey text directly in the search box, so you can stop typing as soon as you see what you need."
This essentially means that different people would potentially get to see different results for the same query. Up until now, search queries used to return identical results for users ( i think in the same continent/region). Now with this, Google is introducing a ground shift : adding a new dimension to search and bringing out in the open a loop in play. Today’s new dimension is the user.Tomorrow,it can potentially add language,location, nature of access device to the mix and this spins a new territory. The basis of operations of search engines and by extension the discipline of search engine optimization is fundamentally altered. The new loop of response and feedback is going to make this field more and more sophisticated. . Like an aircraft on flight path monitoring direction, altitude, wind speed, payload etc to help pilot take the right instanteous decision,Google Instant search results gets predicated on a variety of factors. Marketers, SEO professionals have quite a task at hand moving forward.
In a webcast today for select attendees, Google shared additional details - rather it put on display it’s massive engineering prowess. Google estimates that a search typically takes 9 seconds to enter, 0.8 seconds for data transfers between its data centers, and 0.3 seconds to process. The user then spends 15 seconds choosing a link. For consumers, Instant can save the average user 2-5 seconds per search via dynamic search results, enhanced predictive technology, and scroll-to-search functionality that changes results pages as users choose search suggestions. You can read more about Google Instant here (including crazy statistics, like "If everyone uses Google Instant globally, we estimate this will save more than 3.5 billion seconds a day. That's 11 hours saved every second."). Some users may find the new process a little bewildering but may soon get acclimatized.
What does Google get out of this :more query volume, increased market share and loyalty - but more importantly overtime traffic may shift more to head ( recall the last time you looked at the 47th result). Optimizing search results around query volume makes access to such results more precious and by extension turbocharges average price per keyword click thus boosting Google’s monetization initiatives much better.
So massive engineering prowess pushing better monetization efforts sums up the development - consumers have nothing to complain but rejoice at the next massive leap that Google has taken.
Google published the first ever “Google’s Economic Impact” report, which estimates that in 2009, Google generated $54 billion of economic activity for advertisers, publishers, and non-profit bodies in the United States. This is done using the AdSense & AdWords frameworks and delivered via paid search clicks, natural search clicks, AdSense revenue sharing, and Google Grants aka charitable donations. The report reveals that Google’s US revenue in 2009 was $11 billion; the $54 billion figure is Google's computation on how much value Google creates for its partners. The methodology used therein is quite a pioneering one, given that this is the first time that someone is attempting to assess the economic impact of online ads at this scale : the whole internet and who else is better qualified than Google to attempt this.
This is an interesting report, the implications of which will be felt more and more in the years to come. If we reason out that search engines (Google)are in many senses replacing displacing traditional media ad spends, it may be difficult to agree with Google’s $54 billion estimate for its direct economic impact but we have to concede a few things. This is a new growing media, the media, by nature brings in more participation from new class of users and one that may be potentially more ready to spend and the flexibility this provides to advertisers - they can cap daily ad spend and can look at in realtime extending or suspending ads based on clicks and reach. Google's report primarily depends on the assumption that clicks on natural results drive five times as many leads for businesses as clicks on paid results. However, we believe the indirect impact may be much much more.
I have seen estimates suggesting that Google's Traffic Acquisition Cost payments to US publisher websites, (as assessed by analysts) at about $3 billion, for an revenue of 11 billion dollars which is now being projected by Google to have an advertiser impact of about $50 plus billion. Lets look at the calculation : Google calculates the advertiser impact of its search service by assuming that for every dollar spent by an advertiser, the advertiser generates two dollars in sales (and one dollar in “sales minus marketing expense”, which the report calls “profits”) from consumers clicking on the purchased search result, and a further seven dollars in “profits” from consumers clicking on natural search results for the same advertiser, creating an 8X multiplier effect. Thus, claims the report, $7 billion in US-owned and operated revenue should drive $56 billion in economic impact
Now the difficult part: - Google says that businesses receive an average of five clicks on search results for companies as ads, and by its own conservative standards, estimates that search clicks are about 70 percent as commercially relevant and valuable as ad clicks, and thereby calculates that advertisers receive a total of eight times in surplus what they spend in AdWords. Look carefully here:
- Google assumes that people clicking on links are as inclined to purchase. Any benefit from link clicks has nothing at all to do with having ads. The two are separate events, and a company gets the benefit from search engine optimization and all the work of having a Web site, rapidly increasing the effective cost of using the ads.
- As the Jansen and Spink study states, “More than 80% of web queries are informational in nature and approximately 10% aretransactional, and 10% navigational.” This may lead one to think that the vast majority of clicks need not convert into sales (this is understandable) and so the impact may be less than what is assumed herein.
Thinking deep, it occurs to me it would be tough to embrace or discard Google’s estimated multiplier effect .As noted earlier, Google calculates the advertiser impact of its search service by assuming that for every dollar spent by an advertiser, the advertiser generates one dollar in “sales minus marketing expense” from consumers clicking on the purchased search result, and a further seven dollars from consumers clicking on natural search results for the same advertiser, creating an 8X multiplier effect. Google estimates that one dollar spent on search generates two dollars in advertiser sales via consumer clicks on paid search results. This assessment is centered on the methodology devised by Hal Varian, its Chief Economist, which in its core, assumes that advertisers are spending rationally to buy a certain keyword ranking rather than a higher or lower ranking, and then deriving the implied value which advertisers place on a click. I would think that this resonates well with my intuitive reasoning. Google estimates that one dollar spent on search corresponds to seven dollars in advertiser revenue via consumer clicks on natural search results.
Ideally , Google should have attempted a Lifetime Value assessment to derive the economic impact but rightfuly chooses to center these on transaction basis given the characteristics of the internet media and its limited lifespan. I talked to a few power users of these services (corporate and SMB) and find that for many interenet centric revenue generators, the proportion of their online centric revenue coming out of search engines on an average hover around upwards of 20% in their established and growing phase of business. The informal estimates from such sources point to 40-20-40 ratio - direct traffic,keyword centric and natural search referrals. For startups and early life enterprises, the ratio could be 25-35-40 pointing to a near 6X ratio. The swing across the range hovers between 4x to 6x ratio.
Without search engine, Google acknowledges advertisers would find other means of reaching consumers. We have to concede that search engines are not just merely capturing existing consumer spending rather they stimulate additional consumer spending(any online purchaser can vouch for this - they tend to buy more , owing to the dramatic increase in efficiencies and the smoothness of the operation). To be fair, Google’s true “economic impact” on a community should likely be measured in a way that balances the economic patterns it disrupts with the new-model of business it generates. Online ads and Google being the dominant player there are directly influencing the sale and retail mechanisms in a big way and are bound to increase their influence and hopefully, we will see the economic impact assessment methods improve a lot more along with the results.
Google just officially confirmed that it is releasing a new open-source web browser,named Google Chrome . My immediate reaction is to see Google also launch a mobile browser that can be deployed to multiple OS platforms. This may influence adoption/potential cross-over to the Android mobile platform. Sandboxed Tabs would be a key thing to watch.They are also moving to multiple processes. Seriously, waiting to try as soon as this gets released.
As I pointed out years back, Google is using the internet to systematically devalue Microsoft’s assets, forcing a “Microsoft’s Black Monday” on the wall street in future. Google is leveraging the mantra that built Microsoft: who controls the UI controls the user; who controls the API controls the programmer.
While there may be scepticism about what could a new broswer do - except introducemore confusion, as I see it, if Google Chrome delivers on its promise of speed, stability, security and reliability, it will like gmail soon commiand the mind share of the web users. This in turn should make it possible to push common web standards! The advantages of their fundamental design changes will likely force other browser makers to reexamine and bring out similar or better appraoches to the market . On the privacy front,the google chrome ecosystem should bring in the right plug-ins to allay any concern there. This will definitely shake up the IE/Windows behemoth .
As cloud computing, becomes more mainstream, users will begin to spend more time online - and a presence in the entire internet food chain is going to help Google.While Google's products are not a replacement OS, but the collection of tools released thus far serve the same purpose. Even products that run on Windows PCs, such as Google's Picasa photo-editing software, could tie back to Google's online services. Google is intelligently rebatching Microsoft desktop products/services as its. Web companies, such as eBay, Yahoo and Amazon.com, treat their Web sites as customizable platforms, & offers a starkly different technology vision to developers than traditional software companies do.It is slowly leading to a situation where one model says build for Windows and the Microsoft 'stack'; the other says build for the Internet. The platform of the future shall not be focussed on controlling the hardware but it is going to be around access, community, collaboration & content. Clearly , this is an exciting announcement that will benefit competition, innovation, enforcing standards, web developers and the horde of web users.
Update : Google quickly repointed the Google Browser launch page to its homepage!
When people go online they know what they want and how to do it, says Jakob Nielsen, the usability guru. The annual report into web habits by Jakob Nielsen shows people are becoming much less patient when they go online. Instead of dawdling on websites many users want simply to reach a site quickly, complete a task and leave. Most ignore efforts to make them linger and are suspicious of promotions designed to hold their attention.
Look at the observation here : "In 2004, about 40% of people visited a homepage and then drilled down to where they wanted to go and 60% use a deep link that took them directly to a page or destination inside a site. In 2008, said Dr Nielsen, only 25% of people travel via a homepage. The rest search and get straight there, pointing out that search engines (though imperfect though) rule the web. The findings are significant indeed. To drill deep or scan wide is always a challenge for web surfers and at a time when the choices seem to be multiplying by the day, it is only to be expected that surfers would like to land directly at the information that they are seeking. This imposes a pressure on the web designers - with searches going beyond home page. The branding, usability, navigation will have to be looked at every page in the site, given that surfers can and will land inside any page.Homepage sheen would not suffice to be seen as a trendy and sticky site. This alos portends an important trend here -online advertising may prove to lot more tougher and whoever gets it right would dominate the market - a clear reason why Google dominates online advertisement space. No complaints - this helps the cause of usability, information architecture and the state of web adoption improve for the better.
With about 65 percent marketshare, Google continues to lead the mass search space. In the UK market, Google has over 85% marketshare. The marketshare numbers are not mere numbers for the sake of numbers - these correlate to revenue potential. It is estimated that Google translates each point of market share into about $100 million in annual revenue. Peter Norvig, Director of research oversees about 100 computer scientists as they work on projects as diverse as medical records management and machine translation. In this interview he talks about the directions of search in Google.
TR: You claim that Google's accuracy is pretty good. How do you know how good it is, and how do you make it better?
PN: We test it in lots of ways. At the grossest level, we track what users are clicking on. If they click on the number-one result, and then they're done, that probably means they got what they wanted. If they're scrolling down, page after page, and reformulating the query, then we know the results aren't what they wanted. Another way we do it is to randomly select specific queries and hire people to say how good our results are. These are just contractors that we hire who give their judgment. We train them on how to identify spam and other bad sites, and then we record their judgments and track against that. It's more of a gold standard because it's someone giving a real opinion, but of course, since there's a human in the loop, we can't afford to do as much of it. We also invite people into the labs, or sometimes we go into homes and observe them as they do searches. It provides insight into what people are having difficulty with.
TR: Where do you see Google search in two to five years?
PN: You'll see integration of various kinds of content. We're getting into speech recognition and all the kinds of interfaces on phones, where you have a tiny screen and awkward keyboard. You'll see that gaining in importance. You'll see integration of our various properties. We used to put the onus on the user and ask them if they wanted Web search or image search or video search. Now we're trying to solve that for them and serve up the results in a way that makes sense.
Simplicity in thinking and good execution to support scale characterises Google and so ling as it sticks to these as minimum goals in all of its inititaitves - it is bound to suceed further.
The NYTimeshas an interesting take on the emerging Google –Microsoft race . Google believes that cloud computing can be a game changer. Henry Blodget has an interesting perspective on this. As I see it, Microsoft appears to be losing customer centricity and their cultural DNA seems to be moving away from incremental innovation –particularly with the windows platform and their inexplicable delay in rolling out Longhorn are clear indications of losing steam. Microsoft will take decades to be out of business as their product basket of offering is wide – and some niches may still save the company.I am still baffled why Microsoft (other than for being selfish about its interest)is not considering providing a hosted solution - when enterprise application software vendors are beginning to provide and stepping up aggression in pushing. Microsoft may end up to be a pale shadow of its present –that would be sad indeed – but the risk is indeed high for Microsoft. Microsoft is lucky that currently there is no one alternative that can dislodge it in key arena's - starting particularly in the desktop segment. While looking at future of microsoft, I wrote that the impending power of Broadband and hosted models are creating a new tapestry very different from what Microsoft is envisaging - one can note that microsoft has lagged behind in most of the new elements in this picture. Many think that hordes of cash, lock-ins and a lack of credible alternative to it would insure microsoft against any downturn in future - I doubt it - while microsoft may be trying to creating froth in the consumer electronics sector- it is appallingly falling behind in its ability to be creative and seems to be losing touch in respect of making new roll outs win in the market - MSN portal, MSN search , declining attraction towards hotmail, the non starter called spaces.msn.com etc - all conclusively point to this. Glorious past is certainly no pointer to great success in future. It is nice to see that Microsoft is planning to take the right moves - Time for Google to pre-empt Microsoft in this move. Another interesting perspective to be considered here us that given the exponential increase in Internet connected devices, coupled with increased processor power and bandwidth attached to devices, the very definition of "server" may be about to change. With IPV6 about to get rolled out on a massive scale, the nature of relationship between a server and a client undergoes significant shift. This enables creation of an environment ripe for the development of new client layers and application models, operating on a much more distributed scale than we have ever seen and who better than Google could capitalize on this. The Google model of massively distributed computing gets more relevant here and extend this to a new ecosystem of net-enabled devices. Its going to be a different, different world – one wherein Microsoft would begin to get more and more less dominant.
A new study finds that about 15 percent of pay-per-click advertising dollars could be lost due to clickfrauds, contends a new study. Pathological traffic that impacted a small sample of less than a dozen websites resulted in advertisers being billed for illicit clicks that the search engines did not catch. The early results of a Fair Isaac study of click fraud showed some channels could hit ad campaign budgets at a rate of 10 to 15 percent. Also, Fair Isaac contends that Google's specific estimates of what their unsupervised detection efforts find in click fraud is "not believable," based on their experience detecting fraud in other industries. Without advertiser data, search engines cannot defeat click fraud.
The 10 to 15 percent rate of pathological traffic hitting Fair Isaac's small sample of advertisers, less than a dozen sites, far exceeds the 0.02 percent rate touted by Google. Earlier, Danny Sullivan wrote Google’s declaration that self clicks are traced and offset looks like a wrong claim as its feasibility looks suspect. Some of those who have been blacklisted by Google for adsense misuse cry about Google’s highhandedness in dealing with them by stopping their accounts without sharing much details of the suspected fraud. With Google poised to massively increase its revenue owing to conquering more marketshare, it is only fair that there is some more openness from Google into their fraud detection methods, which they guard closely for the protection of their advertisers, or more results from the Fair Isaac test, it's hard to tell who to believe right now.
Dan Dodge concludes, 1% of search market share is worth over $1 Billion'. His math concludes that each search query produces $0.12 ad revenue, which gives a value of $1B for just 1% of total search market share.
The world internet population is in excess of 1.2 B internet users and Google leverages the internet through search and adsense – of 50% of internet search happens through Google, and a portion of revenue coming through adsene.
We are going to see the explosion of internet moving forward. Jakob Nielsen points out that with usability scene improving, in the long run, every time companies increase the value of their online businesses, they end up handing over all that added value to the search engines. Any gain is temporary; once competing sites improve their profit-per-visitor enough to increase their search bids, they'll drive up everybody's cost of traffic. This is great news for search engines: they can double their income by doing nothing. Google is improving its market share consistently – we are likely to see a disproportionate share of revenue growth moving forward – it is likely that Google’s revenue growth would rise faster than the rise of its search marketshare. That’s why it is interesting to see Microsoft beginning to focus on advertorial market in an aggressive manner – after all revenue streams in the internet revolve around search and advertorial market. Having lost the search game, Microsoft wants to atleast build some revenue streams – one will have to wait & see how this would pan out. But one thing is clear : short of a technological shift in the internet/search technology, google is poised to vastly improve its revenue as the internet begins to reach more and more people around the world.
Joshua Greenbaum writes, salesforce.com is the next Siebel, the next CRM has-been, the next low-priced software buyout opportunity, unless somehow the company embarks on a remarkable turnaround from its current moribund strategy. It may take a couple of years, and there may be some big blockbuster announcements and a couple of good quarters in the interim, but it’s gonna happen, and it’s gonna be ugly. I definitely see merits in Greenbaum’s argument – SFDC may need to recreate itself to grow - the sustainable next big thing is still awaited from SFDC.
Bob Cringley writes that Google is sowing the seeds of its own eventual destruction. His point is by investing in so many good people and chartering them to generate and execute good ideas, Google is overstretching itself. His point: good ideas alone are not enough. The real money is in taking existing ideas and twisting the idea just far enough to make it work in a fantastic new way. Somehow I do not think that Google can be that easily written off – they have remarkable depth in their thinking and reasonable degree of strength in execution. Remarkable are the ways that law of nature plays itself!!
Update : Jason Wood comes with an outstanding piece in support of SFDC, in response to Josh Greenbaum's criticism on SFDC. Josh responds to Jason's criticism. I do not agree with Josh on the two quarter decline but I do think that SFDC needs to come with something significant to sustain the growth rates(despite customer lock-ins/deferred revenues - these would be seen as tail wind effect(s) when future numbers begin to roll out. There still remain lot more questions in front of SFDC to sustain its phenomenal growth rates - more particularly we have to see the speed at which it is able to establish itself inside fortune 500 enterprises.
I am just back from a long period of travel and catching up on last weeks developments - need to fiish a lot before I set out to travel again. John Battelle writes, the fact that DoubleClick went to Google strikes me as a seminal moment in the history of this industry. Microsoft could not win it, despite the cash it was willing to spend. He reports that he learns that Microsoft did offer to match it, and was willing to pay even more to insure that Google did not corner the online ad market. But for whatever reason, the private equity firm that owned the majority of DoubleClick’s shares decided to go with Google.
John Batelle builds his thinking on the basis of what he could gather from his sources and need to be seen as such.I wouldn’t just like that take it as fact that DoubleClick was offered more by Microsoft and that they turned it down. If what John says is true( I would imagine that this should be true given his connections), I do think that it is indeed a significant win for Google. I have dealt with DoubleClick in the past and know its vast potential. For Google, this is indeed significant – they outdistanced a potential big time threat – Microsoft but at the same time have expanded their core service offerings. The deal is not just that – it has helped Google to increase its customer base as well. Google paid 100% more than what it paid to acquire YouTube. Its no wonder why competitors like Microsoft, Yahoo, AT&T are crying foul. I think more than anything else the allure of cash must have helped Hellman-Friedman decide in favor of Google considering their acquisition cost was a mere one billion and odd dollars. My good friend and fellow enterprise irregular points out that Hellman-Friedman is not just a doubleclick pony. I think, at the least, this would help Google keep its focus on what it wants to do for securing its future, not worrying about competition for some time. Moves like this put pressure on players like Yahoo – particularly in its ability to get more value out the current set of raw materials. Google’s aggression is not only going to help its cause but very likely to drive Yahoo and Microsoft to come together. Its interesting to see what all a shrewd marketleader can do – expand the market, consolidate its position and define what competition needs to do!!
Salesforce.com’s foray into content management space has made different people look at the development in many different ways. I was slightly amused to see Nick Carr’s perspective that this could lead to a fight between Google & Salesforce.com!! I think that Nick is probably overlooking several issues here:
A. SFDC is far more entrenched than Google within its customer base B. Google’s non paying customer base far exceeds it s paying customer base by several degrees as against SFDC’ s paid subscribers. C. There’s a business model issue here – Hosted solution is a defacto one for Google as against SFDC selling hosted solution as part of its value proposition. D. Google & SFDC are currently working on API’s that can extend their applications reach (for that matter every other hosted solution player is trying this) E. Google does not offer content management facility for its customers – though it has by al means built an excellent content management system that it uses internally in applications like news.google.com or finance.google.com. There’s no mention that Google may make this available in future for its customers – if that happens, with API extensions, it would be a serious play – no competition can expect to come anywhere closer to it – in terms of its capabilities and feature list F. Google Apps Premier, is on paper extending new enterprise level customization and integration capabilities. Google’s partners are said to be developing a variety of solutions based on its APIs, including email gateways, enhanced security, Google Calendar synchronization, third-party integration with Google Talk, as well as offering deployment, migration, and additional support services. G. SFDC’s sales machinery and customer relationships may appear to give it a leg-up but Google’s search capabilities and whole host of new offering would endear it more to customers
While with Google Apps, Google may end up creating new forth like what SFDC did with its entry year back – I do not see SFDC acquiring these capabilities across the board to be in reckoning for competing with Google – Clearly Google's ability to manage content is streets ahead and Marc Benioff would know this for sure. In fact it is entirely possible for Google to technically aggregate its products and features and deploy a pretty strong strategy in many markets - potentially taking SFDC head on.It could be a case of minimal unavoidable overlaps but both these smart players know where not to tread into each others(s) shoes. Is there a case for these two players to work together - very much given SFDC's enteprise reach and Google's engineering prowess in harnessing information.
If ever you need to look for a case as to where business model could ensure win for an enterprise- do not look beyond Google. What an amazing enterprise, it is turning out to be! I was just about to compile and understand the financial muscle of Google when I stumbled on this excellent compilation by Eric Bangeman on Google’s financial muscle. Look at some of the impressive numbers therein:
- Revenue Growth from $400 million plus in 2002 to $10.6 billion in four years (should rate as an all time record for business!!) - Cash & Short term investments from $2.1 billion in 2004 to $11.2 billion now - 99% revenue comes from online advertising - Traffic acquisition costs are 31.5% of the revenue(this means other competitors can’t even dream of spending this – more so by the nearest competitor, in this case Yahoo,further fortifying Google’s lead)
Look at the excellent financial lead Google has over competitors:
- Cost of sales at Google is at 8% & Eric claims that the corresponding number for Microsoft is 22% & Yahoo is 20% and Apple is 22% - Cash on Hand for Google is at $11.2 billion , Apple has $12 billion, Yahoo has $1.6 billion while Microsoft has $34 billion in cash.
Look deeper – none of Google’s competitors have any wherewithal to compete on existing areas given the cost structures and the topline lead helps Google to keep running faster and creating more money – this is a double treat – it increases the distance of lead while further bringing down/maintaining the cost of operations(Google has been adding cash to its reserve at a faster rate in the last three years). And what does one do with this excess cash – keep investing in core business and focus on innovation and acquisition in new areas. Perfect – can any of the existing players dare to compete against Google in its core areas and expect to win over it? Forget it. Google is not just a technology platform, it has become a business platform –one that would ensure increasing rates of success.
Sadagopan's Weblog on Emerging Technologies, Trends,Thoughts, Ideas & Cyberworld "All views expressed are my personal views are not related in any way to my employer"
