In the monsoon of year 2000, many of us found Google's search to be indistinguishable from magic.
I was studying at a journalism school in Chennai. Word spread in the computer lab about something called 'Googly'. A friend had tried the search engine on a laptop at the Indian Institute of Management, Bangalore. She was sold, and told us about it. We laughed at the possibility. But there was no clicking back after we discovered Google.
Our 66-year-old Dean – always the stickler for grammar and brevity – warned me about misspelling in Google's search bar. He was right. In 2001, when I misspelled the name of footballer 'Beckenbauer' on Google, it took me to pages that featured the wrong spelling. (But those minor blemishes never stopped the good Dean from using Google to find a rare poem or two on the internet. It was magic!)
Soon enough, Google became the role model in search quality, introducing a function that could second-guess or prompt what millions of users were looking for. A possible set of queries presented itself, even before we typed out the query completely. Users thus saw their 'intent' on the monitor and clicked. And there were no spelling mistakes.
It was management thinker, the late Prof C.K. Prahalad, who first told me in 2008 that Google had turbo-charged the idea of technology innovation. While Microsoft and Apple had made innovation about a hotshot product release each year, he pointed out that Google was iterating and making product innovations on the fly – quietly. And we users were experiencing these changes live, though the experiments were on us. Google had evolved into a worldwide lab that could deploy, measure and iterate across online needs. This was unprecedented.
These memories came to me last week when I read about US Senator Elizabeth Warren, a Democrat and presidential hopeful, who has called for the break-up of tech giants Google, Amazon and Facebook. It was telling that I used Google to know more about Senator Warren! But it doesn't need a Senator for us to see the monopolistic expanse of Google, Amazon and Facebook. There is no corporation close to any of them in their respective categories. And it is scary when so much user data is concentrated on a solitary player in each online category. Just go back to Mary Meeker's Internet Trends 2018 report to see what I mean.
In Your Face
Three of the top five messaging products belonged to Facebook (WhatsApp, FB Messenger and Instagram). WeChat is at number 3, and Twitter at a distant number-five. WhatsApp and FB Messenger clocked more than 1.25 billion monthly active users (MAU) in 2017. Instagram's MAU was at 750 million, according to the Internet Trends report released in May 2018. Is Facebook a monopoly? Yes.
Meanwhile, Amazon's share of the e-commerce market in the US went from 20% in 2013 to 28% in 2017. Merchandise worth $129 billion was transacted on Amazon in the US in 2017. Try naming its competitors. Amazon's market cap was $830 billion yesterday, with Alphabet (Google's parent company) marginally ahead at $831 billion! Pretty overpowering for competition, don't you think?
Meeker's report also highlighted the broad picture in the mobile operating software (OS) industry. From 2013 onwards, more than a billion smartphones get shipped globally every year. In 2013, Android's share of the smartphone OS was 80% of a billion units shipped. In 2017, that figure had gone up to 85% of more than 1.4 billion smartphones shipped!
The writing has been on the wall.
Google's ubiquity is surreal – it dominates mobile browser (Chrome), operating system (Android), platform (search, Maps, YouTube), and has products like Flights (travel), Pay (wallet), Duo (video calling)... we could go on and on. When Google CEO Sundar Pichai was in Mumbai last week, he launched 'Bolo', a speech-based learning app.
“This isn't the Google I knew,” says a Xoogler (former Google employee), who worked there for three years before 2010 and asked not to be identified. When I push him, he recalls a philosophical debate in the company during his time when Google asked itself: are we a 'switchboard' or are we a 'destination'?
It is a question worth revisiting as governments in Europe and a senator in the US are calling for regulation of the tech giants.
Switchboard or Destination?
'Switchboard' is a term from yesteryear—the landline telephone era. The switchboard system was used in a public telephone exchange to interconnect circuits of telephones. This helped enable telephone calls between the subscribers or users. It connected a caller with the receiver of a phone call.
When Google began, it sought to direct internet users to contextually-accurate website destinations, like how a switchboard directed phone-calls to the right person or department. “People come to us, and we connect them to the web destination they want to go to,” recalls the Xoogler.
In contrast, with the ‘destination’ approach, people could come to Google, and get their information on Google (Google Flights), by escaping a few steps. Its 'OneBox' feature helped users find an answer to their query in a separate display box within the search engine result page (SERP). A ‘OneBox’ answer would be applied for user queries for which there is only one right answer (temperature, time, currency exchange rate, birthday).
Over time, the implications would turn out to be profound. As Google's OneBox began to take away traffic and, by extension, business from another product, it bit the hand that feeds Google’s revenues. For example, an airline website that was paying Google to get web traffic started having fewer unique visitors on its website because of Google Flights.
The compelling argument for the 'destination' approach in Google’s desktop era was: it is good for the user. Let's take an example: picture the India of 2012, when Google’s operating system (OS) Android had a 14% market share of smartphone real estate, and ‘short message service’ (SMS) was still in vogue. Back then, Google could provide answers more swiftly with a ‘destination’ approach as it cut out steps for the user who was searching for a quick result.
“Each (Google) product took a slightly different view or had a different trade-off,” the former engineer says. “It (switchboard-vs-destination) was a conversation that was live within Google for a long time—in the web context and the mobile context. It’s just that the trade-offs were different.”
What has made all this complicated over time is that Google’s business activities have started to take on a wider range. Plus, Android has 85% of the mobile OS market. Can it become a player when it knows so much about the online playground and, in some markets, is the playground?
“In the past, companies were more circumspect,” says a management professor, who requested anonymity. “If you look at companies like Intel, on many occasions, they considered going into the competitive business itself. But they decided they didn’t want to compete with their customers and chose to be a chipmaker. Intel did consider going into PCs in the 1990s. Finally, they decided to do the ‘Intel Inside’ branding campaign.”
The tech giants have to decide where not to be and self-regulate or open themselves up to regulators. For now, the advanced technology companies are indistinguishable from monopolies.
Tech Trail is a column that delves on technology in the Indian realm. Kunal Talgeri is a freelance journalist in Bengaluru. The views in this column are those of the author.