Google+ Throws in the Towel…Or Maybe Not

google+Google may – or may not – be getting ready to throw in the towel on Google+, the company’s competitor to arch-rival Facebook’s social media flagship product. Industry pundits now believe that Google’s social media guru Vic Gundotra’s suddenly announced departure from Google signals the death knell for the unpopular “Me too” product. The worrisome question for Google users who are addicted to the company’s cloud-based software suite is, “What’s next on the chopping block?”

Not so fast. Informed sources are telling reporters that Google+ is not going away. In order to explain why, however, it will be necessary to fill in the background first.

Problems with Google+
Rumors about Google+’s immediate demise do not take into account the salient fact that Google has not tried to monetize Google+. It is free of charge and, right now, at least, it is also free of advertising….and that may be part of Google’s long-term plan, using Google+ as the access point for all of Google’s offerings. Think of Google+ as Google’s front page for all of its service. It just has not yet opened for business. In the meantime, of course, Google would like to take a chunk out of Facebook’s business. The question is, “Can they?”

Google+ was launched in June of 2011 as a direct replacement for the company’s failed Google Buzz product, harshly criticized for the manner in which the product exposed users’ confidential information to public scrutiny by trying to be all things to all people.The subject of several lawsuits alleging privacy violations, the product was replaced with a newer and improved version of the product – which turned out to have exactly the same issues.

One user’s complaints summarized the feelings of many others. “I turned this thing on for the first time, and I was stunned by the amount of personal information posted there. My entire resume, the long one, the one I don’t want everyone to see, had been entered in my profile, but I don’t remember ever doing any such thing. It scared the hell out of me.”

Another user wrote the following – on his Google+ page – for everyone to see: “The Internet is getting completely out of hand. I didn’t even know I was enrolled in Google Circles until now, have no recollection of ever enrolling it and, now, I am wondering just how many social networking sites are too many. Overload and breakdown at the same time.

Google+ vs. Facebook Face to Face
It is a fact of life at Google that everyone in the company watches everything the Mark Zuckerberg is doing over at Facebook like a family of hungry vultures looking for a free meal. By the same token, Zuckerberg – and Facebook is still very much the Mark Zuckerberg show – watches everything that Google does with checkbook in hand, ready to pounce on any company he thinks will give him an edge against Google.

In the social media venue, however, Google is poaching on Facebook’s private reserve, with only marginal results so far. After 18 months in business, in 2012, Google+ had amassed a respectable 435 million enrolled members, but only 223 million were active users, for a 51.2 percent utilization rate. An active user is usually defined as an account holder who uses the account at least once a month.

One year later, Google+ reported 1.15 billion enrolled members, largely a result of Google making it mandatory to sign up for Google+ in order to get a free Gmail account. That is a 164 percent increase in membership, but usability lagged behind at 359 million active users, for 31.2 percent utilization rate, down almost 20 points from the previous year.

Facebook wins the direct comparison by several lengths.In December of 2013, Facebook reported 757 million active daily users, which represented an increase of 22 percent over 2012. Google+ reports only 359 million active monthly users but does not report active daily users. Facebook’s total enrolled membership of 1.23 billion shades Google+ total membership of 1.15 billion by 6.5 percent or 80 million additional members.

According to these figures, then, Facebook has more than twice as much daily traffic as Google+ gets in a month, which makes Facebook the Goliath to Google’s David….but there is more to it than these raw numbers seem to suggest.

The fact that Google+ does not carry any advertising is a subtle hint about Google’s intentions. In the meantime, Facebook has taken the hint, and taken a step back from their own advertising program, reducing the number of advertisements and banishing them from parts of the user’s screen. These are all good ideas because, until recently, spending time on Facebook was rather like watching episodes of The Vikings on The History Channel, which serves up five minutes of advertising for each eleven minutes of programming.

Google Has Bigger Fish to Fry
Facebook is a mature product. Zuckerberg’s henchmen may tinker with this or that, sometimes triggering serious backlash from the users, but it is what it is, a social media networking site, and the company has wisely not tried to make it more than it is.

Google, on the other hand, has bigger fish to fry. They are quite willing to go head to head against Facebook and Twitter in the social media space. That is why they bought YouTube, which gives them an additional channel through to reach consumers.

As big as Facebook is, it is chicken feed compared to Microsoft, and that is the prize that Google co-founders Larry Page and Sergey Brin have their eyes upon. Microsoft is vulnerable on so many levels that it would take another article to run them all down. Their latest fiascos – discontinuing support for the enormously popular Windows XP product, getting caught with their hands in the cookie jar reading employees’ emails, the lackluster performance of Windows 8 in the marketplace and the enormous security hole in their Internet Explorer web browser – are just drops in the bucket compared to what else has not been going well.

Microsoft product line is approaching senility. Their Windows operating system owns the PC market for the simple reason that most people are too lazy to install the alternative operating systems that are out there. Windows would be vulnerable to a Google onslaught if Google should decide to make a run at the operating system market….and no one doubts that Google could buy or build a competitive operating system….but the Mountain View, California, company has even better fish to fry.

The key to understanding what is going on in the marketplace is that economic forces are driving everyone to cloud based computing to lower costs and increase efficiency. In a sense, the cloud is bringing computer users right back to where it all started out, with individuals using dumb terminals connected to their companies servers, and utilizing the programs and the data on those servers to do their work. The cloud merely expands that concept from the local area network to the wide area network of cable system operators providing connects to the internet where more and more people are putting their software and data.

Microsoft struggles with the cloud. Some years ago, the company tried to get Microsoft Office Suite users to buy into an annual service contract for a constantly updated version of Office that would be located on the Microsoft Cloud. That program crashed and burned.

The reason? Buyer reluctance was based upon the early training Microsoft gave its customers. Microsoft Office is a real product. It comes in a box, on a disc, with instructions and a user key. People felt they were buying something real rather than an intangible. There was also a problem with clock speeds. Most people did not have high-speed connections back then, making a cloud-based version of Office even more problematic, and many were fearful about the security of their data.

Google’s Free Software Product Strategy
The Redmond, Washington cohort is once again trying to convince their millions of Office addicts to purchase their cloud based product, with the same mixed results. The reason for that is that Google has come up with a better idea: free software.

The 2013 version of Microsoft Office runs from as little as $87.50 for the student version, to $220 for the professional version. Microsoft’s cloud-based product, Office 365, goes for $10 a month, or $99 a year for the Home Office edition for up to five users. (A Mac version is available for one user at $69.95.)

Google Docs provides almost exactly the same functionality free of charge for an unlimited number of users, and those users also get multi-user shared document connectivity so that task groups can work together with the same documents, along with 15 GB of cloud-based storage. Microsoft offers 7 GB of storage with their cloud-based system.

Cost-free, better functionality, more storage, and continuing development of new applications combine to suggest that Google is indeed making an open and obvious run straight at Microsoft’s bread and butter application…and Microsoft seems to be at a loss over what to do about it. They have been so big, for so long, that they have lost the dexterity that a front-runner needs to stay ahead of the pack, which may be one of the reasons that Steve Ballmer decided to pick up his marbles and go home.

(The other reason, sports fans, is that Ballmer would very much like to buy into the NBA and the former Microsoft CEO is already being mentioned as a replacement for disgraced Los Angeles Clippers’ owner Donald Sterling. Ballmer is 0-3 in his attempts to become an NBA owner, but Angelenos do not need two basketball teams, especially when one of them is the Lakers and the other is the Clippers, and the 6’ 5” Ballmer would dearly love to sail the Clippers up the West Coast to Seattle and install them in their own brand new venue.)

Stuffing the Cannoli
Whether or not that happens, unlike Ballmer, Google+ is not going anywhere. Right now, it is like an empty cannoli shell, waiting for someone to stuff the filling in. It has the shape but not the content of a universal application.

Think of it this way. Google+ is the unused front door because everyone knows to go around the back of the house where the rear door – Google Drive – is always open and ready to receive guests. Eventually, however, strangers will start coming to the front door – “If you build it, they will come” – and, when they do, Google+ is going to be the front door to which most of the new traffic is going to be directed.

In the meantime, exactly what is Google getting for its free Google+ social media product, not to mention its free Google Docs software and the 15GB per cloud storage? The answer is traffic, and traffic is the name of the game on the Internet. If you have traffic, you can always monetize that traffic and that is exactly what Google is doing now, putting out all the freebies up front, like marijuana dealers giving out free samples of their wares and waiting until they are hooked before they slap the ads on formerly ad-less pages and maybe even charging access fees for what was formerly free.

By Alan M. Milner
Look for me on Twitter:@alanmilner

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