We take a look at this US tech giant's history
Google is the biggest search engine in the world, taking over 40,000 searches every second. With this known fact, it’s no wonder that most of its revenue comes from its Google Ads network. Since its inception, Alphabet has been launching projects and acquisitions to find the next ‘Google’ product that can create billions of revenue for them.
Unlike many other big tech companies, Google’s revenue solely revolves around ads. For Amazon, they successfully launched AWS and Prime, which contributes close to 20% of its total revenue. For Microsoft, they’ve added companies like LinkedIn, Azure, and its gaming portfolio, which also adds more than 20% to its revenue.
Alphabet’s revenue consists mainly of ad revenue products with only a small amount contributing outside that. With only 0.4% of its revenue coming out of its hundreds of ‘bets’ it’s currently making, it is still continuing to pump more projects out every year.
Let’s take a look at some of them as well as some learnings we can conclude.
Alphabet’s failed experiments so far
You might be wondering how many failed experiments Google has exactly. According to killedbygoogle.com, there are over 225 projects that Google has launched and since closed (or will be shut down). Some of the most notable ones you might know include:
- Google Talk: Originally, this was a messaging service for both text and voice. It was launched in 2005 and shut down in 2013 in favor of Google Hangouts.
- Youtube Gaming: This live streaming service operated for over 4 years before officially shutting down after it failed to break through the market against Twitch.Tv and Facebook Gaming.
- Google +: This internet-based social network was launched in 2011. After failing to get traction like its other peers, it shut down officially in 2019.
Some of the ones that I found personally interesting that I’ve never heard of include:
- Google Ride Finder: This service used GPS data to pinpoint and map the location of taxis, limos, and shuttle vehicles. In my opinion, they were so close to discovering an earlier version of Uber but ended up shutting down in 2009.
- Google Flu Trends was a service attempting to make an accurate prediction about flu activity. It ended up shutting down in 2013 after its model did not match the reality of an outbreak. In my opinion, with COVID-19, this service would have been beneficial if it was still in operation.
- Pie was a work-centric group chat website similar to Slack. Launched in the same year, it ended up closing shop only in a few years.
- Hire By Google was an applicant tracking system that helped SMBs hire applicants. This ended up launching in 2017 and closed subsequently in 2020. This looked like an attempted play to hit the hiring market but ultimately failed.
The learnings of Google’s desire to try
Google has churned out hundreds of ideas, and we’ve seen its innovation labs produce some of the most interesting products. This includes tiny AI-powered cameras to glasses with augmentation features. Although many of these will have never seen the light of day, many of these products have since been developed into more successful products of today.
Although the Nexus series no longer make phones, Google has since shifted its attention to its Google Pixel collection, which has been doing well. In my opinion, what Google does extremely well compared to other companies is its ability to execute quickly and keep lean.
This has allowed the company to stay lean as if it's still a startup even at its formidable size. Because it has multiple smaller teams working on projects around the world, it can quickly shut anything down and move resources around if need be.
This has made Google a company successful at both innovating as well as playing catch up. Although the company was very late to the party for cloud, it has managed to achieve sizeable growth in recent years, drawing in $13.06 billion in 2020 with a growth rate of 47%.
But Google has also pulled the plug too early
In my opinion, Google has pulled the plug early for some of its products. From ones in their communication space to VR, they have attempted many different types of innovation and ambitious projects without giving some the long-run rate it needed. Google had a chance to own different spaces but gave up before it managed to take off.
For example, it had multiple communication platforms but ended up closing many of them without being a clear leader in the space. Considering its current portfolio, the question needs to be asked if Google is ready to pursue any more of its recent ideas in full force.
Currently, it’s been experimenting with home tech, augmented reality, AI, and more. Even though Google was first to the market with its own home tech, it had to play catch up to Amazon’s more aggressive expansion strategy.
Is acquisition instead the answer to Google’s growth
Google is known as the company willing to experiment and fail fast yet has not created any new product in recent years that translated to massive return for the company.
Yes, you could argue that the app store and, of course, maps have helped its presence in the market, but it’s still a drop compared to the rest of its revenue generators.
Even though Youtube was a success, it was an acquisition made in 2006. Although Google has had a history of creating hundreds of projects, we’ve seen them instead recently go after new acquisitions to help them compete in certain spaces.
From Nest to Waymo and Looker, they’re acquiring startups left and right. This is, so they have some kind of company playing in each space that’s looking to grow. With its success with Youtube, perhaps Google is taking a different approach.
In my opinion, every major tech company is getting ready to play in each big emerging tech space, and Google looks definitely ready to fight the fight.