Rivals are mad as hell and they’re not gonna take it anymore.
It's the year 2014, and Googlezon, a fearsomely powerful combination of search engine Google Inc. and online store Amazon.com Inc., has crushed traditional media to bits. Taking its place is the computer-generated Evolving Personalized Information Construct—an online package of news, entertainment, blogs, and services drawn from all the world's up-to-the-minute knowledge and customized to match your preferences. And it's all collected, packaged, and controlled by Googlezon.
This is the future according to EPIC 2014, a faux documentary posted to the Web in late 2004 by young journalists Matt Thompson and Robin Sloan. Thanks to their slightly tongue-in-cheek, Twilight Zone-inspired tone, the short video drew as many chuckles as gasps of dismay from the media types who viewed it. Today, nobody's laughing.
That simple little search box we all use every day? As the place nearly 400 million people each month start on the Internet, it's the No. 1 gateway to the Net's vast commercial potential. With more data on what people are searching for, Google can serve up the most targeted and relevant advertisements alongside the results, drawing more clicks, more cash, more users—you get the idea. Consumers love Google's simplicity and results, which is why it draws 56% of all searches. No wonder eager advertisers shoveled some $10.6 billion into Google's coffers last year, up an astonishing 73% from 2005. If you can believe it, Google's $144 billion market value tops that of Time Warner, Viacom , CBS , ad agency giant Publicis Groupe , and the New York Times Co. combined.
To the consternation of many of those companies and more, Google is now using that market cap, along with its $11 billion hoard of cash and investments, to storm a wide range of traditional markets. It's selling ads in newspapers, magazines, radio, and, in a trial program, television. In February it fired a torpedo at the software industry with a suite of online office software it is selling for a small fraction of the price of Microsoft Corp.'s Office. It's spooking the telecom industry with fledgling efforts to provide free wireless Internet access. Google's phenomenal ad machine, in short, has the potential to vaporize the profits of any industry that traffics in bits and bytes and to shift the economics to the advantage of Google, its users, and its cadre of partners. "It's Google's world," shrugs Chris Tolles, vice-president of marketing at Topix Inc.. "We just live in it."
Googlezon, GoogleWorld, just plain Google—whatever you call it, it's scaring the wits out of everyone from the power lunchers of Hollywood to Madison Avenue ad moguls to Silicon Valley entrepreneurs. Now, after years of hand-wringing and thumb-twiddling, some of them are pulling out the heavy artillery and firing one round after another on the Googleplex, the company's headquarters in Mountain View, Calif. The latest salvo: On Mar. 22, NBC Universal and News Corp. announced big plans for a rival to Google's enormously popular YouTube video site that will run not only television show clips but even full-length movies on Yahoo!, AOL, Microsoft's MSN, MySpace.com, and other partner sites.
Just the week before, Viacom sued Google for a headline-grabbing $1 billion, charging YouTube with willfully infringing on copyrights by allowing users to upload clips of The Colbert Report, South Park, and other TV shows. A couple of weeks earlier, Copiepress, a group representing Belgian and German newspapers, won a copyright case that could sharply limit Google's usefulness if it sets a precedent. And get this: In the Valley and Washington, D.C., there's even cocktail party chatter about whether the search giant's power needs to be reined in by antitrust regulators. It's unlikely to happen but is an indication of rivals' growing trepidation about Google. Says Paul Martino, chief executive of the search service Aggregate Knowledge Inc.: "We're beginning to see the Anything But Google' backlash."
And something bigger. Google is ground zero in a battle among traditional media and tech industry leaders and startups alike for the hearts and minds of the world's consumers—or at least their eyeballs and wallets. To an extent that none of the first generation of dot-coms did, Google has come to represent all our hopes, dreams, and fears about the disruptive promise and dangers of the Internet.
The question now: Does the pushback against Google mark that turning point when a successful company's power starts to work against it? Could be. "
http://www.businessweek.com/magazine/content/07_15/b4029001.htm
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