I’ve just listened to a fascinating interview with Andy Rubin the VP of Engineering at Google about the launch of their iPhone ‘killer’, the Nexus One. I must admit when I hear that Google was launching its own phone I thought it was signal of something potentially significant and this interview confirms that view.
In business for a long time I’ve thought that it is the business that knows who its customers are and how they behave and who the customer turns to when they want something that has the most power. We’ve seen this with the way the supermarkets control the traditional GMCG (broadly groceries) world and I suspect they’ll do well as they extend their consumer relationship into banking.
Anyway this interview seems to confirm to me suspicions I’ve previously held that Google is looking to use its dominance of being the first point of call for consumers online to build its business in new ways.
My suspicions were initially aroused when I discovered that Google has taken control of cinema booking schedules. Try searching to find out what’s on at your local cinema … and notice who is giving you the answers. Does Google link you through to the Cinema owners site and let you see their promotional stuff. No! Google makes it simple for you by providing the answers you want yourself. That is good for you and notice that it is Google making things simple for you.
But it is potentially a real problem for the cinema chain in that their branding is nowhere to be seen and they lose information about consumer behaviour! At the moment you do get through to them when you want to book. But just imagine the conversation that might happen in the future. “Hello, is that Vue Cinemas? Yes this is Google – we know everyone that is wanting to see this film and we can take the bookings for you through Google Checkout for a tiny fee – much smaller than it costs you to take the bookings – oh and we’re already doing it for the Odeon down the road, so if you don’t want to play ball, we can just carry on sending the bookings their way – Its your choice!”
Now lets jump back to the latest interview. Remember this is Google selling a Google branded piece of equipment – a mobile phone – PLUS mobile phone network services itself through Google Checkout! To me this was a sign of something significant and the interview confirms my view. I noted a lot of subtle points and I’d summarise the key ones as:
Andy Rubin of Google continually referred to ‘the programme’ of which selling the Nexus One is the first item. i.e. Google is looking to vertically integrate in lots of areas – and I can see that moving far beyond mobile phones.
Google became by far the most successful search engine because it applied the principle of ‘give the consumer the choice and make it simple for them’ . Again Andy Rubin talked repeatedly about how buying a mobile phone was complex and how they were making it easier for consumers.
So in summary, is the idea that you buy lots of things online from Google far fetched? Am I getting over excited? Or is that how Google is trying to leverage its knowledge of and trust from the consumer? Listen for yourself:
Bob is a specialist in running high value added service businesses, having run five such businesses as General Manager, Managing Director or Chief Executive. His last employed role was as Chief Executive of a £16M, 200 person family owned business having previously been Chief Executive of an AIM listed company for which he raised £5M funding and which he grew from £4M to £12M in three years through two acquisitions and organic growth, and a corporate PLC subsidiary where he was Managing Director responsible for delivering £10M profit on £45M turnover through 450 staff.
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