GoogleMart: Google's Plan to Become the One-Stop-Shop of t
Source: Jordan Weissmann
Google Music will not change your life. The new service, which debuted Wednesday at an event in Los Angeles, cobbles together a bunch of features that should be familiar to music fans. There's an iTunes-style library that sits in your web browser. There's a music store that lets you share songs with friends via the web giant's social network, Google+. There's 20,000 songs worth of free cloud storage. The free bit is nice. The package is attractive enough. But nothing here is revolutionary.
It doesn't have to be. Google isn't out to change the music business. They aren't trying to finish Steve Jobs' work. Instead, they're following the path of another prophet of American capitalism, one who doesn't usually get much love in tech circles: Sam Walton.
The internet is entering its big box phase, and Google wants to be Wal Mart.
WELCOME TO GOOGLEMART
Google became a $194 billion company by dominating search. It sorted the messy Internet and made money by helping marketers laser-target searchers. But while search is still big business, nobody thinks it's the future of the web. The world has moved on to social media and stand alone mobile apps. Instead of a wide, interconnected mess, you have neatly organized silos.
Google still wants to own that new world. But it has competition.
Right now, roughly five companies are fighting for dominance of the next generation internet economy: Google, Apple, Amazon, Facebook, and Microsoft. Each has a different core business--Google with search; Apple with hardware; Amazon with e-commerce; Facebook with social media; Microsoft with operating systems. But each is also launching raids into their competitors' home turf. Microsoft's Bing has grabbed 28% of the search market. Amazon's Kindle Fire is about to go head on with Apple's iPad. Apple has tried to break into social media with its iTunes based Ping. The list goes on.
You can see this as a bunch of simultaneous tug-of-war battles, or you can see it one big fight to the same finish line. These companies want to be everything to everybody. They want to be 1990s AOL. They want to be 2011 Walmart.
This is the big-boxifcation of the New Web. The more goods and services a tech company offers, the more time users will spend with them -- and the more money they make. The same way a family can walk into Walmart and buy everything they need, from the DVDs to the diapers to the Dockers, a netizen can take out their Android and live fully in the e-world Google has built them. Ditto Amazon via the Kindle Fire. Ditto Apple with the iPad.
But unlike its competition, which have each chosen a few key areas in which to expand, Google is growing in almost all directions. It's in social with Google+, OS with Android, video with YouTube, shopping with Google Product Search, office work with Google Docs, etc., etc. It wants to own the Web the way Walmart owns retail. It wants to be GoogleMart.
MUSIC IS JUST ANOTHER E-AISLE
That's where Google Music fits in. The service costs nothing. The music is priced competitively with iTunes. Unlike iTunes, it will work on Android powered phones, which according to Nielsen make up 43% of the U.S. smartphone market. And the app ties into Google's current suite of services through sharing on Google+. Existing music services like Spotify, Rdio, and iTunes will be tough competitors. But Google isn't trying to win by being better. It's trying to win by just being there.
That's the Google way. Making everything you want available how you want it, when you want it, and as cheaply as possible. Pop songs may never be a big part of Google's income stream. Digital music sales are expected to top out at about $6.3 billion this year. Google's revenue in the third quarter alone was nearly $10 billion. But the size of the profits are almost beside the point. A music player isn't a revolution. It's just another e-aisle in GoogleMart.
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