Google's Trifecta Bamboozle
Readers of this blog know that Google is the master of the bamboozle strategy (search on "bamboozle" in the Search Blog box above for more on this). The Googlers have outdone themselves lately.
Exhibit 1 is "Open Social." Objects in this mirror are really much smaller than they appear. This laugher is a thin little API that is no more open than any other API that ties you to one provider's platform. Sure, you can write a web widget to Google's specs and users go though Google's infrastructure when they use it. Woo-hoo! As one wag put it, this is only exciting to those pundits unable to spell API. And don't get me started on "so what makes this social?"
Exhibit 2 is Android and the "Open Handset Alliance." This is nothing more or less than Google's attempt to fragment the cell phone market and disrupt the oligopoly of the cell phone carriers and handset makers. Those nasty oligarchs won't let users play according to rules that favor Google. Now, I have no love for these cell phone control freaks, but they have given us a mass, reliable, no-brainer network. Bookman's rule of diminishing technology alliances is that the more members, the faster the decay into irrelevance. Note for example the stunning (lack of) success of the great Microsoft PlaysForSure alliance versus that of Apple's iPod/iTunes fortress of solitude.
Exhibit 3 is the Google stock price. Yes, Google has been and will likely continue to be a great company and a great investment. The bamboozle is the failure to split the price. Please repeat after me: ten shares of an $80 stock is not inherently more or less valuable than one share of an $800 stock. The value is in the expected future earnings of the company per share relative to the price, not the absolute stock price. But the pundits would not get nearly as breathless about Google stock hitting $74 a share as they do about it hitting $740. By not splitting the shares, Google has maintained the illusion of being even more stratospheric in its growth than it actually has been. Wait until they hit $1,000 a share, that's gotta be more newsworthy than hitting $100 after a ten-for-one split.
Watching Google is like watching the Wizard of Oz. Behind the smoke and mirrors and dazzling effects, there is much less than it appears.
Copyright © 2007 Philip Bookman
Exhibit 1 is "Open Social." Objects in this mirror are really much smaller than they appear. This laugher is a thin little API that is no more open than any other API that ties you to one provider's platform. Sure, you can write a web widget to Google's specs and users go though Google's infrastructure when they use it. Woo-hoo! As one wag put it, this is only exciting to those pundits unable to spell API. And don't get me started on "so what makes this social?"
Exhibit 2 is Android and the "Open Handset Alliance." This is nothing more or less than Google's attempt to fragment the cell phone market and disrupt the oligopoly of the cell phone carriers and handset makers. Those nasty oligarchs won't let users play according to rules that favor Google. Now, I have no love for these cell phone control freaks, but they have given us a mass, reliable, no-brainer network. Bookman's rule of diminishing technology alliances is that the more members, the faster the decay into irrelevance. Note for example the stunning (lack of) success of the great Microsoft PlaysForSure alliance versus that of Apple's iPod/iTunes fortress of solitude.
Exhibit 3 is the Google stock price. Yes, Google has been and will likely continue to be a great company and a great investment. The bamboozle is the failure to split the price. Please repeat after me: ten shares of an $80 stock is not inherently more or less valuable than one share of an $800 stock. The value is in the expected future earnings of the company per share relative to the price, not the absolute stock price. But the pundits would not get nearly as breathless about Google stock hitting $74 a share as they do about it hitting $740. By not splitting the shares, Google has maintained the illusion of being even more stratospheric in its growth than it actually has been. Wait until they hit $1,000 a share, that's gotta be more newsworthy than hitting $100 after a ten-for-one split.
Watching Google is like watching the Wizard of Oz. Behind the smoke and mirrors and dazzling effects, there is much less than it appears.
Copyright © 2007 Philip Bookman
Labels: Business Strategy, Google, Strategic Planning
posted by Phil Bookman at 12:41 PM
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