The Power of Google
From wsuwiki
HISTORY
A Ph.D. student at Stanford University named Larry Page began research on his dissertation in 1996. His dissertation was about looking into the mathematical properties of the internet. He understood that the structure of the internet and its linking capabilities. Page was fascinated about what webpages link to a page and the number of backlinks about useful information about those pages. Then a man named Sergey Brin who was also a Ph.D. student at Stanford and a good friend of Page, decided to team up together on this dissertation. They began working on the PageRank algorithm. This was important because they wanted to be able to transform the linking data and combine it and make it usable on the internet. Then rank the data provided as an order of importance. They decided to call this website Google after a name given in the movie “The Hitchhiker’s Guide to the Galaxy.” At the beginning of 1999, Google had linked over 60 million pages.
HOW IT WORKS
Google wanted to let user access to be free. So, it had to think about how it would generate a profit. It wanted to gain market share by utilizing “The Long Tail” approach. This means that let anyone have access to google then taking advantage of the number of users that access the webpage and generate profits by charging people for the ranking of key words. If you have the money to pay for being listed of a key word first on the list then you have to pay according by the number of people who search for those key words. It the key word is used quite often then you would be a lot, but if your key word is not searched for very often then your price would be lower.
HOW GOOGLE USES "THE LONG TAIL" APPROACH TO DO BUSINESS
• Free for all users
• Generates a profit from search engine optimization
• Continually trying to impact users lives
• Acquiring more and more functionalities
GOOGLE TODAY
Google is the most popular search engine on the web. This is a great feat because there are now many different search engines available. In 1996, Google went public and offered a stock offering of $85 a share. Today its shares are valued at over $370 a share. Page and Brin have already sold over $1 billion dollars in shares. Google’s first major acquisition was YouTube. Google bought YouTube in 2006 for over $1.5 billion. YouTube brought about some controversy about possible copyright infringement, but that did not stop Google. Google thought it was important to buy YouTube because online video popularity is skyrocketing. Venture capitalism is the new venture for Google. This segment of Google is named Google Ventures. Google takes advantage of its user base in helping the companies that it invests in. It seems that Google is trying to gain its influence in our lives. Google believes that they are capable of helping start up companies with potential to succeed and foster them into being successful. The types of businesses it would like to focus on a wide variety of industries, such as: bio-technology, health care, clean technology, among other areas. A most obvious example of Google Ventures of investing in a company, is Tesla Motors. Tesla Motors is a start up company from Silicon Valley, California that is building an electric sportscar for mass production to be available for sale later this year. Google loaned Tesla Motors of $40 million. Today Tesla has about 70 employees. This is a major investment for Google because the demand of alternative energy cars is greatly increasing because of Global Warming. A company named Twitter has gained popularity incredibly over the past year. In "Twitter—What is it??" it explains that Twitter is a website where people can talk to eachother via the computer in almost real time. Currently Google in talks with Twitter to make its newest acquistion. Talks are in the are almost complete and it is highly probably that Google will own Twitter in the near future. There is no price given yet for acquiring Twitter, but it will probably be over the billion dollar range. Many people believe that this deal is taking place because Google is threatened by Twitter. This is due to Twitter Search function that it great at documenting up to date information from its users, which threatens Google. Another reason why Google is threatened by Twitter is because if Twitter were ever to be sold to one of Google’s rivals like Microsoft or Yahoo then Google may lose competitive advantage in the search business. Twitter could help Google in social networking because Orkut is currently not doing very well.
REFERENCES
• "Google to Buy Twitter? Report Says Deal is in the Works - PC World." Reviews and News on Tech Products, Software and Downloads - PC World. 10 Apr. 2009 <http://www.pcworld.com/article/162558/google_to_buy_twitter_report_says_deal
• "SiliconBeat: Tesla Motors, new electric sportscar company, raises $40M from Google guys, others." SiliconBeat | The people and companies driving the innovation of Silicon Valley. 10 Apr. 2009 <http://www.siliconbeat.com/entries/2006/06/01/tesla_motors_new_electric_sportscar_company_raises_40m_from_google_guys_others.html>.
• "Need venture capital? Google Ventures | Marketing/Ecommerce Research." Internet marketing resources, web development, affiliate and ecommerce site guides. 10 Apr. 2009 <http://www.tamingthebeast.net/blog/web-development/google-ventures.htm>.
• Google definition | Dictionary.com." Dictionary.com. 10 Apr. 2009 <http://dictionary.reference.com/browse/google>.