Google's Choice (2) Lessons for the Software Giant
Agile Google vs. mighty Microsoft.
[+] Back then, NC was a premature concept
Google has already made its choice between a media company and a technical one, which prompts people to associate Google with Microdoft even more than as a contrast to Yahoo!. Of course, an Internet company can't do without technology, but Google is more technology-oriented, which makes it more like a software company.
Looking back to the past, we can find another company that once severely threatened Microsoft experienced similar struggle to arrive at a decision: Netscape. This company started as a browser provider, which earlier on aimed to forge a network computing platform and sought to take the place of Microsoft's desktop operation system (OS).
If all the information and software can be obtained on the Net via browser, then we won't need to buy and install any program in our computers. For example, when we want to edit a document, we can access Word on the Internet and save the processed file on the Net when we finish the work. We don't even need a hard drive in our PCs.
Such a compact is the so-called NC (Network Computer) brought up by Oracle's CEO in 1997. After turning on our PCs, we need only browsers. Nothing more. It doesn't matter if it runs on a Microsoft's OS.
There are several factors necessary for NC's success. The first is a browser with a mature interface. At that time the interface facility is not ready yet and consequently not fit for a sophisticated network application. The second is a reliable and efficient programming environment. Java was once expected to provide such an environment but it didn't make it.
The third is network bandwidth. If there is no software in the computer, then if we want to make a drawing, we'll need to retrieve part of a drawing program via the Net to the local PC, with a satisfyingly fast speed since most people are not good at waiting. The NC concept is fantastic, but the timing then was not right.
[+] Different mindsets between a software-oriented and a media company
Since Microsoft started to tie Internet Explorer (IE) with Windows to encroach on Netscape's market share, Netscape's plan to replace Microsoft's OS had been disillusioned. Netscape's management team decided to transform itself into a portal operator.
Running a media company has less to do with technology. More specifically, for a portal, it is relatively irrelevant which browser a user employs to visit its site. Netscape retreated from the role as a software company and turned to the media business.
Can Netscape come off? The history gives no successful precedent for a software company to convert to a media company. What a media business needs is "the talent to lead the fashion," which is not a specialty of a tech firm. Such talent can not be processed in a scientific approach; naturally Netscape didn't make it.
Even MSN.COM, set up by Microsoft for joining the scrimmage of portals, does not stand out. And, the dual role as media/technology company often causes competition of internal resources, resulting in fierce internal strives and attrition.
A software company's mindset is to sell the content, and what it creates is for making money. A media company wants eyeballs, and what it produces is for free viewing. When a company operates both in two lines of business at the same time, the top management vexes at how resources should be distributed. What's worse is each business line thinks the other as the parasite of the company.
Yet, the time keeps moving on. As a software industry leader, Microsoft is speeding up to transform to a media business. This change may be driven by its vision or maybe by the environment. But no one can deny the impact of Google, the next-generation challenger, on such a change.
[+] First step: develop a habit of remote storage
Back then NC (network computer) sounded like an unrealistic idea, the reason being that it's far less convenient to execute a program via the Net than to do it on a local PC with the program installed in it. Forget about the matter of bandwidth: can any user feel comfortable placing her/his data on a remote host?
However, there is a starting point for everything. Google first chose the oldest and most popular network application on the Internet to persuade users: free email account with up to 2GB of storage capacity.
Checking emails from your web browser, which has to some extent substituted software like Outlook, is the most acceptable web-based application by Internet users. Yet still users may be thinking to download emails to local PCs, as the storage of the remote host is not sufficient.
Gmail (free email service offered by Google) users may have the impression that Google constantly reminds you of your email storage of up to 2GB, and that you need not delete any emails. So users start to see it unnecessary to download emails to a local PC.
While you are thinking to get rid of Outlook, the great Google Print initiative attempts to scan all the books in libraries and move them online. Now you don't even install electronic document readers such as Adobe Reader (not to mention buying books).
Writing diaries and storing/exchanging photos online are not inventions of Google, yet it quickly accommodates the two services to its offering. This means that users are more and more confident in saving their data online in a remote host.
[+] Agile Google vs. mighty Microsoft
When will Microsoft develop a web-based Office with no installation to a local PC required and available on demand? It seems that it's just a matter of time. The will of the software giant to turn the tables has to be taken seriously; last time when it exerted such power, its rival Netscape collapsed.
Yet the situation seems to be much more favorable to Google this time. The concept of NC came too early. The software industry has not really prepared to embrace the concept of NC until now. Users are more used to web-based applications, broadband more accessible and next-generation web interfacing technology and the environment more mature.
Google has proved that a software company can survive on advertisement sales only; it doesn't need to sell software any more. It's the first lesson Microsoft got from Google. To provide software to users via the Internet instantly bypasses the network of sales channels which was built up by Microsoft over more than a decade and has knocked down many software vendors.
The second lesson Microsoft got from Google is that users are getting used to web-based applications with a browser interface. When free offering becomes more regular, it will get more and more difficult to sell packaged software that needs to be installed on a desktop.
Microsoft is now facing the internal tug of war between software-/media- oriented approaches (for example, how to distinguish between Windows Live and MSN.COM after all?) and between packaged software sales and free software offering. On the other hand, the generic online company Google appears to be much more agile. The contest between the two is surely to be very exciting.
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