Opinion: Google is to the Internet what Microsoft is to the desktop, but that strategy could land the search giant in court.A nearly ubiquitous platform with tightly integrated applications sharing a similar interface. An enormous company with large reserves of cash able to fund research and development in nearly every aspect of computing. A brand with nearly universal recognition that touches nearly every computer user in one way or another. The ability to control most aspects of the user experience, shut out competitors though savvy positioning and superior technology, and control information and access through its market position.
Microsoft? Nope. Google.
While poor lil' ol' Microsoft struggles to remake itself from a software provider to provider of online services that makes its money mainly from advertising, Google's already pretty much there. It's got a huge suite of online applications of Internet living that encompasses most of the apps we use on a daily basis: e-mail, calendar, search, mapping, publishing, news and entertainment. And now it's got shopping. Big time.
The debut of Google's new Checkout service that integrates a universal shopping cart (effectively similar to a Net-wide Amazonian One-Click shopping service) with Google's already ubiquitous AdWords system, an integrated transaction history, and the ability for publishers to add low-cost e-commerce to their site (Google Checkout only charges 2 percent and 20 cents per transaction, which is lower than PayPal's lowest rate), marks a major new step in Google's plans for Internet dominance. By combining shopping with search, Google has now closed the loop on the consumer, streamlining the process from interest to action to conversion.
But is this good for consumers? Microsoft got into serious antitrust problems when it leveraged the ubiquity of Windows to control the desktop. But regardless of all the legal wrangling that went on (and the inevitable fallout for Microsoft), the whole issue with Microsoft's desktop dominance is fast becoming moot. With more and more of the action going on on the Web with the plethora of Web 2.0 services that do just about everything desktop apps used to do, Google's quickly taking the upper hand and Microsoft is playing catch-up. The strategy is simple: Whoever controls the information controls the market. The OS has become irrelevant.
Before we were all connected together through the Internet, owning the individual desktop experience made sense from a business perspective. If you controlled access to the desktop, you could control the marketplace by controlling access to the operating system through proprietary software and control at the code level. Dominance was about control and control was possible because the computer itself became the gateway.
But once the Web came along, things changed. The browser presented a universal, open system for delivering software and information. The barriers to entry were low and anyone who could string some code together could publish, provide services, or deliver software (in the browser) to anyone with access. The paradigm shift that occurred with this was one in which information, not access, provided value, especially in a world where economics were based on advertising and not software sales. In an ad-supported world, information about consumers, their habits, their online history, and their behavior becomes increasingly valuable as advertisers seek the Holy Grail of advertising where they can deliver the right ad to the right person at the right time in order to influence behavior.
As more and more consumers make the switch to Google's services and enjoy the benefits of integration—ease of use, single source access, convenience and uniform user experience—they're going to have to decide whether or not they want to give up their privacy and personal information in exchange for these benefits. Through their wide net of offerings—e-mail, calendar, blogging, mapping, advertising, search and now shopping—Google stands in a position to have unprecedented access to just about every aspect of consumer information.
Google also stands poised to control the commercial side of things as well. Since AdWords advertisers who utilize Google Checkout will have the distinct advantage of being able to drive conversions right from the point of search while simultaneously making it easy for consumers to purchase, they'll enjoy a unique advantage over merchants that don't choose to participate. This integration benefits consumers, and they'll increasingly choose Checkout merchants over others simply because it'll be easier to buy.
Along the way Google will benefit from the processing fees, but more importantly it will benefit from the increasingly huge storehouse of consumer information gathered through the program. This information will allow it to target its advertising in a way that Yahoo, MSN and others can't, making Google a better and better choice for advertisers who want ROI through highly targeted campaigns.
And as the campaigns get more targeted, the results will be better for the merchants, Google will gain more information, and, well, you get the idea. It's a perfect feedback loop of information control.
There's no doubt that consumers are going to like the new Checkout service. For now. But in a world where information is the coin of the realm, will they begin to get nervous about the fact that Google knows more about them than anyone else? Are they willing to trade privacy for convenience? So far, most indications are that the answer is yes.
But there was a time when similar things could have been said about Microsoft and its integration of its browser with its operating system. Whether Google Checkout raises the ire of consumer advocates (or the public itself) remains to be seen, but it's probably not too early to raise the specter of antitrust now. As the Googleverse expands and sucks in more of our information, it might be time to start getting worried.
Sean Carton is the chief strategy officer of idfive, where he helps clients understand the constantly changing intersections between design, marketing, communication, and technology.
