Technology is changing fast. Google who?
As Dennis Burns points out in his recent blog post at Parking Matters, technology is changing fast. Fifteen years ago you probably didn’t have an email account. Ten years ago you probably didn’t have a laptop, and you probably didn’t have a home internet connection. Five years ago you had probably never heard of Facebook. Three years ago you probably didn’t have a smartphone or watch any streaming movies on your computer, and last year you had probably just heard of pay-by-phone parking. The times are changing fast in the world of technology, but it’s quite a bit of fun to watch it happen. As a company in these times we believe it’s very important to stay on the leading edge of where things are headed, because even the most respected and trusted technology brands can tumble with a misstep.
As we follow tech and business in our efforts to stay ahead, we often have lively discussions on what technologies and what businesses will win. A few months ago we had some internal debates regarding who would win the internet war between Google and Facebook (did you even realize there was a war?).
Google is obviously the entrenched giant, but we came to the conclusion that Facebook would win because their tech had given them a strategic advantage. Facebook was riding the strength of their technology and the “Network Effect”, whereas Google has been treating their search business much like a cash cow in the hopes to fund other profitable ventures. Both strategies should be lauded, but in the end, Facebook’s will win.
The reason we believe the tide will shift towards Facebook is because of the inherent network effect. Facebook has high switching costs for the customer (moving pictures, setting up friends again, losing history with friends and wall post history), whereas internet search has low switching costs (switch the URL that you go to). We have actually seen this in the past. Starting in 1996 Altavista was the dominant search engine. They held this post for a year or so – right up until Google launched and took over the search world. Users updated their search bookmarks and the once dominant Altavista disappeared. It was just that quick.
After Google took a swipe at Facebook with Google+ in an attempt to create a social network, the retaliatory motion by Facebook would be obvious, and far more effective. They would create a search engine. The advantage that their search engine would have though, would be that it could search their social network as well as the internet. So when you searched for the “Drake Hotel” you’d see your normal internet search results along with your friends posts on the subject. Facebook could search the social grid, but Google could not. This would be a huge advantage.
We think this is a perfect example of the breakneck pace of change in the technology arena and a reminder that you should always ensure that your operations are flexible enough to move with the rapid pace of technology. We must all be cognizant of the tech around us to stay ahead of the game, both strategically and technologically.