Google searches for a way to avoid Microsoft’s fate

 


Powered by Guardian.co.ukThis article titled “Google searches for a way to avoid Microsoft’s fate” was written by John Naughton, for The Observer on Sunday 18th January 2015 07.00 UTC

The news that Google’s share of the web-search market in the US has suddenly dropped is interesting. According to an independent analytics firm, StatCounter, last month Google’s market share dropped to 75.2%, compared with 79.3% a year earlier. That is its lowest share since 2008, when StatCounter started tracking the data. Yahoo, by contrast, seems to be on the up: its December market share (10.4%) was the highest it has achieved since 2009.

This could be just a blip, of course, and it doesn’t change the fact that Google is still the dominant player in search or that its share of the European search market ranges between 90% and 96%, depending on which country you look at. So this is not the time to start selling your Google shares, but it does make one look at the company through a different lens. What if the dominance of its core business were beginning to wane?

Remember that Google is, despite the hoopla about self-driving cars, antisocial spectacles, YouTube, the “right to be forgotten”, stratospheric balloons and the other exotic stuff, primarily a company that makes its (colossal) revenues from search-driven advertising. (Advertising provided bn of the company’s bn revenues last year.) All the cool, PR-friendly stuff that the company does stems from two things: those vast revenues and the shareholding structure that enables the company’s co-founders to do as they damn well please rather than being hounded by quarterly earnings reports and Wall Street expectations.

Google’s existential challenge is therefore how to keep the search money-pump going. So far, the main strategy has been to do everything in its power to extend internet use. The more people who are connected to the net, the better it is for Google. (Which is why Project Loon, which aims to bring free internet connectivity to poor countries using balloons in the stratosphere, makes both philanthropic and commercial sense.) But since most new internet users in the next decade will access the network via mobile phones, that means Google has to be active in that space too. Hence its development of Android, the operating system that powers the overwhelming majority of smartphones.

So Google is doing all it can to keep its core product growing. But it’s also working on a Plan B just in case search declines or is displaced by some as-yet-unknown technology. Part of Plan B is trying to be spectacularly innovative (self-driving cars, say); another part is to acquire startup or young companies such as Deepmind or Boston Dynamics, just in case one of them has managed to find the secret of life, the universe and everything. This quest has probably turned the search giant into the largest and most active venture capitalist in the US. You could view this either as a quest for world domination or planning for life after search.

Bill Gates once said that the only technology company that reminded him of Microsoft in its early days was… Google. Thanks to one of those delicious ironies in which capitalism excels, guess which company Google now reminds people of? Answer: Microsoft in its current dotage. Gates’s creation was once even more dominant in the industry than Google is now. It had three core products – the Windows operating system, Office and Windows Server – which were licences to print money. Microsoft had huge revenues that just rolled in every quarter, just as Google’s advertising revenues do today, and on the back of them built a huge 128,000 employee company. But, cushioned by its money-pump, it failed to innovate and, in particular, failed to address the decline of the desktop PC and the rise of mobile computing.

Despite Google’s self-image of an ultra-agile, young company, in fact it’s become a 55,000-employee monster, which is what is leading some people to see parallels with Microsoft. The Bloomberg columnist Katie Benner is one. “Microsoft,” she writes, “was stymied by a huge headcount and, more importantly, legacy products that no one inside the company wanted to mess with for fear of killing the golden goose… Even when those commanding positions were eroded at the margins, it was hard to see a world in which Microsoft wouldn’t be the backbone of a PC-centric tech industry.”

By the same token, it has been impossible to envisage a networked world in which Google would no longer be a dominant player. But after last week’s revelations about market share, maybe it’s time to downgrade “impossible” to merely “difficult”.

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Time Warner internet outage affects millions of US broadband customers

 

Powered by Guardian.co.ukThis article titled “Time Warner Cable outage affects millions of US broadband customers” was written by Alex Hern and Jessica Glenza, for theguardian.com on Wednesday 27th August 2014 14.35 UTC

Internet service went down for millions of Americans on Wednesday morning after cable company Time Warner Cable suffered a major outage.

The company, which has almost 12m broadband subscribers nationwide, said it was investigating the cause of the outage, which apparently began around 4.30am ET. By 6am, it said “services were largely restored”, but an hour later, said it was still “working to restore services to all areas”. By 10am, the company was telling customers the outage had been resolved, but some social media users said access was still spotty.

twc outage
A Time Warner outage map as of 10:20am ET Photograph: /http:/downdetector.com/status/time-warner-cable/map

Affected users besieged the helplines and social media accounts of the firm, which declared an operating income of .1bn in the 2nd quarter of 2014.

On Tuesday, Reuters reported that Time Warner Cable paid .1m to resolve an investigation from the Federal Communications Commission that found the provider did not properly report multiple network outages.

“TWC (Time Warner Cable) failed to file a substantial number of reports with respect to a series of reportable wireline and Voice Over Internet Protocol network outages,” the FCC’s report read. “TWC admits that its failure to timely file the required network outage reports violated the commission’s rules.”

The FCC is currently reviewing a deal for company to be purchased by Comcast – a cable and internet giant.

The deal comes after Time Warner received a bn offer from smaller rival Charter Communications, but accepted Comcast’s offer of .2bn after Charter threatened to unseat the company’s board of directors.

Consumer groups have repeatedly warned that combining the two companies would be a disaster for consumers, and would further reduce competition in an already monopolized market. Several studies confirmed that services competing against Comcast, such as Netflix, have been throttled by the company, the delivery speed of media significantly slowed by the ISP.

Time Warner and other cable companies are facing increased competition from companies such as Google. The Silicon Valley giant installed fiber optic cables in several cities around America. It claims the internet speeds are up to 100 times faster than typical broadband.

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