Why Now, Google?

Why is Google now ending its bamboozle attack on Microsoft? Sometimes the bamboozler discovers serious revenue potential in the attack weapon and decides to make a full commitment to the market, a classic attack. Google signaled this in May when CEO Eric Schmidt announced that the company had a new tag line: "Search, Ads and Apps."

As for why now, Google has the infrastructure and the capital to get past being a one-trick pony. A "black swan" (see Nassim Taleb's excellent book, The Black Swan) could emerge in the search category at any time. Today, once you are as big and dominant as Google in a market, you need to broaden your offerings or risk being eclipsed with no warning or recourse. This is the same reason Apple is no longer Apple Computer.

So Google is now transitioning from a bamboozle attack to a classic attack on Microsoft Office/Exchange. Still with the same purpose, defending search-based advertising against the potential Microsoft threat by diverting resources to defend Office/Exchange, but also now satisfying the strategic objective of adding another major revenue stream.

Copyright © 2007 Philip Bookman

Technorati: Business Strategy, Strategic Planning, Google

Is The Google Office Bamboozle Over?

In a May 23 post, I wrote:

...Google continues to give Microsoft fits with its bamboozle attack on Microsoft Office. This attack is intended to divert some Microsoft resources away from improving search to instead defend Office against the Google threat without taking significant Google resources and without generating much revenue. This is amplified in my book, Attacking The Crown Jewels, which also describes how a bamboozle attack may evolve:

"Bamboozle attacks can evolve into classic or proxy attacks. Sometimes the bamboozler discovers serious revenue potential in the attack weapon and decides to make a full commitment to the market, a classic attack. In other cases, the bamboozler sees an opportunity to spin off or sell the attack weapon to new owners that they are convinced they can influence to continue the attack for them as a proxy attack."

Perhaps we are seeing the beginning of this metamorphosis...at its shareholder's meeting earlier this month, Google CEO Eric Schmidt announced that the company now has a tag line: "Search, Ads and Apps." This is the first time the company has formally given applications equal billing with search and advertising.

I believe that yesterday's announcement of its acquisition of Postini marks the end of the Google Office Bamboozle. Postini is a serious, industrial strength provider of enterprise SaaS email and related data security solutions. This is the first grown-up in the Google Enterprise ecosystem. It gives Google the security chops it needs to earn credibility with businesses. Look for Postini to widen its scope to address the legal and operational concerns businesses have for securing and storing data, and look for this to be the back-end of Google Enterprise applications.

The secure data store was the missing piece of the puzzle.

But I come not to mourn the passing of the Google Office Bamboozle, but to honor it for giving us so much pleasure. And, as noted yesterday, those scampy Googlers have replaced it with their eBay Bamboozle, lest we turn our attention elsewhere.

Copyright © 2007 Philip Bookman

Technorati: Business Strategy, Strategic Planning, Google, Postini

Google Bamboozles eBay

In my book Attacking The Crown Jewels, I describe in detail the bamboozle attack used in strategic competitive defense. Here is the condensed version:

The objective of a bamboozle attack, one of four styles of a crown jewels attack, is to divert your competitor's resources away from the action you fear. You do this by attacking one of his crown jewels, a product so important to his strategy that it must be defended at all costs.

A bamboozle attack is used when you want to own the attack weapon but do not see much revenue potential for your company in its market, usually because the attack weapon does not fit your overall business strategy and model. The idea is to have a lightweight offering that costs you relatively little to keep alive, and that threatens to become a heavyweight competitive threat but never quite gets there.

A bamboozle attack is primarily a marketing activity. For a bamboozle attack to succeed, you must confuse your competitor about your future intentions and make them take the attack seriously because of what it might become, rather than what it actually is. Bamboozle attacks often rely on enthralling industry analysts and pundits with the potential you have to do something wonderful should you ever seriously enter the market. They then become your propaganda squad. It often helps to coyly deny that you intend to compete with your target, all the while making small moves that could be interpreted as heading in that direction. Bamboozle attacks are smoke-and-mirrors ploys, cheered along by a bewitched audience. As in the Wizard of Oz, there is less behind the curtain than you are led to believe.

Google is the master of the bamboozle attack, used to perfection against Microsoft (for more about this, use the blog search function at the top of this page to search for bamboozle). Now those madcap Google bamboozlers have set their sights on eBay. Google wants to divert eBay's resources away from search and search-based advertising. So it attacks eBay's PayPal with Google Checkout and attacks eBay's Skype with its purchase of GrandCentral Communications. This leads to endless commentary by breathless analysts about the wondrous things Google could do with these two attack weapons. The operative word in the last sentence is, of course, "could." Do not hold your breath. Google is all about ad-supported search. All else either feeds that or is one of Google's hobbies, and when a hobby can be used to bamboozle a competitor, all the better.

Meg Whitman, eBay CEO, is familiar with bamboozle attacks. Amazon's Jeff Bezos, that rascal, has been attacking eBay with the unrealized threat of seriously entering its auction business for years. The correct response for eBay to this Google bamboozle is to execute its own strategic plans for search and advertising and not succumb to throwing resources into PayPal and Skype at the expense of those plans. Breath normally, Meg.

Copyright © 2007 Philip Bookman

Technorati: Business Strategy, Strategic Planning, Google, eBay

iPhone Therefore I Am

Most of the iPhone activation issues can be attributed to AT&T's difficulties with unprecedented volume over its inaugural weekend and problems with switching phone numbers between cell phone service carriers. These are regrettable but to be expected. But I think Steve Jobs is positioned to do to the cell phone carriers what he did to the recording industry. Embrace and betray.

First, Steve Cool came out with iTunes, signed up all the major labels and sold individual tunes. Later (quite a bit later) he shook his fist at them for the burden of digital rights management. You see, he never wanted it, the evil music studios forced it on him. Perhaps. Perhaps he also realized that he made most of his money selling iPods (and replacement batteries), not tunes.

This could play out in the cell phone market. Apple makes 100% profit on the iPhone. It chose arguably the worst performing cell phone network. Steve Cool could, after a modest interval, issue a manifesto cursing the evil cell phone industry and demanding they free their networks for unlocked, unfettered cell phones. Hero to the masses, Steve Jobs!

In both cases, Apple is the anti-Gillette, making its money on the razors and advocating that others give away the blades.

On the other hand, the most common knock against the iPhone design is the non-replaceable battery, which could set you back a pretty penny and a lot of inconvenience every year or two. This "feature" is borrowed from the iPod. Are batteries the real Apple razor blades?

Item: A number of blogs have reported that the iPhone makes a real good iPod. Call it the iPod Maxi. Who needs the icky phone service?

Item: Another view is that the iPhone makes a great handheld internet computer if you are near a WiFi hotspot. Call it the iNewton. Again, who needs the phone service?

The next generation of Apple devices could be very interesting.

Copyright © 2007 Philip Bookman

Technorati: Business Strategy, Strategic Planning, iPhone, Apple

The Golden Rule Of The Big Thing

The lemming-like behavior of those in the Silicon Valley software startup ecosystem (which has branches around the world) is based upon the golden rule of the Big Thing:

There must always be one, and only one, Big Thing.

The lemmings, err, sorry, the VCs and software entrepreneurs then flock to that Big Thing.

The last Big Thing was The Web, now known as Web 1.0. If you could spell www, you could get funded. The Valley had a crisis of confidence when Web 1.0 crashed and burned in 2000 and there was no successor Big Thing to take its place. Was the Golden Rule violated? Was the universe as we know it at risk of imploding? Thankfully, Google emerged to save us, assuring us by its madcap growth and willingness to scoop up (often ditzy) software startups that the dream was still alive. By 2004, this begat Web 2.0, the AJAX, social networking, and user-generated content Big Thing. But the interregnum between Web 1.0 and Web 2.0 was painful and shook the Valley's confidence.

But we're back now, and to show we are in control, we are working on the Next Big Thing. We have learned that we must get this in place before the Current Big Thing starts to fade. Thus there are two questions to answer:

1. Has Web 2.0 peaked?


2. What shall we anoint as its successor?

The hubris, of course, is in the second question. Note that Web 2.0 was already ascendant when it was anointed the Big Thing three years ago. No such successor is currently obvious, though there are some pundits lobbying for the semantic web as Web 3.0, the Next Big Thing. But it doesn't work that way. Picking the Next Big Thing is like picking hot stocks. By the time the third major analyst initiates coverage on the stock with a buy, it is probably time to sell. The Next Big Thing will already be on its way to bigness before the lemmings pile on.

Copyright © 2007 Philip Bookman

Technorati: Business Strategy, Strategic Planning