1) Google is building new features, not products. In response to an analyst question regarding the blizzard of new Google products being a bit confusing, Sergey Brin says we shouldn't think of these as each individual products, but rather as new features within the overarching single Google product. Thus indeed what we're seeing is the Google operating system under construction, but live in front of our eyes.
Such a strategy stands in stark contrast to that used by Microsoft (MSFT) whereby Vista was locked away for years, banned from release until the entire product, with all its features, was finished. But that's how you have to do it when you sell a single, large software product. As we pay through ads, incrementally, with Google, they can very well just sell us along feature by feature. In fact keeping us fresh keeps us coming. Perhaps with more open software models, incremental change such as this is better than holding back release and waiting for the big launch date. Just throw it out it their, review, improve, release, review, improve, release, etc.
Yes, exactly. What we are concerned about is that if we continue to develop so many new individual products that are all their assorted silos, you will have to essentially search for our products before you can even use them. And then you will have to search before you can do a search, in many cases.
Instead what we're doing now is we are trying to create the horizontal functionality across a range of products, across media types and so forth. For example, I mentioned already Google Apps for Your Domain,
and that in a sense is a product, but really it just combines a whole bunch of other offerings together, seamlessly integrated together so they can work well for an organization.
Another example which we haven't gotten quite up and running yet, but when you want to
share your documents or your pictures or your videos, it would be nice to have the exact same way to share all those things, to have all that functionality available across all of those media types in the
identical way, rather than developing sort of one-offs for each of those products.
There's a whole set of initiatives that's now going on in the Company to make our product offerings simpler and more consistent for all of our users.
Finally, let me just touch on search. You may have noticed more and more now when you do search you will see, for example, images and news stories and products across the top that you can click to. There are increasingly many ways that we are integrating together all of our search offerings so you don't have to pick where you're going to search first. But we are going to give you the best possible information from all of our corpora.
Ah yes, and another interesting take away... to get a bit lost at the end of this post:
2) One reason Google is relatively worse at monetizing internationally. Beyond local competition in international markets or perhaps a slightly weaker brand in cultures who might not be as stuck-on Google as in the US, it seems there is also a pretty tangible reason why Google hasn't been as successful (relatively speaking, they're still successful) internationally. Basically, one big challenge is that in many countries, websites are still of the informational, rather than transactional variety. E-commerce isn't as developed, online bank/card transactions aren't too easy, thus there are less online merchants who want advertising.
Imran Khan - JP Morgan
The follow-up question related to UK was, if I look at Germany, France, Spain, and Italy and
combined those four countries are 2.5 times bigger than UK, but none of those countries are not more than 10% of your revenue countries. So I was wondering, are you seeing any resentment from advertisers that they're not taking the search advertisement? Or what is the reason that you're not seeing a big take rate? You know, commerce is going very strongly in those countries. ...
Hi. We are actually having great success in Europe in all of those countries. What is really happening is there are just local dynamics that are very different. As an example, traditionally in some of these markets we realize that the websites of, for example, financial institutions were more information-oriented than transaction-oriented. Whereas in the U.S. you can complete a loan transaction or a credit card transaction right away, instantly.
So we have taken a lot of care and time to basically move advertisers that are capable of using our systems to our online channel, as well as then having our sales force on the ground in the field ...
Across the board, we are seeing, off a very small base, but significant growth rates that are actually ahead of U.S. and Europe in some of the emerging markets. Again, they are small bases and we think though that they have the potential as we get the core search products and advertising products working well there, and the future of the newer monetization products extending to these markets.