{"id":35502,"date":"2013-01-17T16:54:33","date_gmt":"2013-01-17T21:54:33","guid":{"rendered":"http:\/\/countingpips.com\/forex-news\/?p=35502"},"modified":"2013-01-17T16:54:34","modified_gmt":"2013-01-17T21:54:34","slug":"will-google-still-exist-in-2020","status":"publish","type":"post","link":"https:\/\/www.investmacro.com\/forex-news\/2013\/01\/17\/will-google-still-exist-in-2020\/","title":{"rendered":"Will Google Still Exist in 2020?"},"content":{"rendered":"

By The Sizemore Letter<\/u><\/a> <\/p>\n

What I\u2019m about to say may sound absurd or even offensive.\u00a0 But I think it is highly likely that Google (Nasdaq:$<\/span>GOOG<\/a>) <\/b>will have disappeared by 2020\u2014or at the very least changed to such an extent as to make it unrecognizable to readers today.<\/p>\n

I know, I know.\u00a0 Google is so integral to modern life that it is no just longer a company; it is also a verb.\u00a0 Much as you \u201cHoover\u201d a floor with a vacuum cleaner, you \u201cGoogle\u201d the subject of your search interest.<\/p>\n

So, I can understand an instinctive belief in the permanence of Google.\u00a0 But think back 15 years.\u00a0 Google didn\u2019t invent the search engine.\u00a0 There were plenty of them around before Google came along: Yahoo, Excite, Lycos and Alta Vista to name a few.\u00a0 But Google buried them all in the blink of an eye because, under the hood, Google had a better mousetrap that was more effective at querying data.\u00a0 And yes, Google is awfully good at it, all these years later. \u00a0But as its rapid rise illustrates, things can change fast.<\/p>\n

Lest you think I\u2019m an anti-Google crusader, I use Google on a daily basis for search, and it\u2019s easily the website I visit most.\u00a0 I\u2019m also an enthusiastic user of Gmail and happen to be addicted to my Android-powered phone.\u00a0 \u00a0Yet Google\u2019s dominance in all of these areas is tenuous at best.\u00a0 Let us consider:<\/p>\n

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  1. Virtually all of Google\u2019s revenues come from online advertising.\u00a0 Given the rate of change in information technology and consumer electronics, I cannot consider that a stable revenue stream with long-term visibility.\u00a0 Furthermore, as online rival Facebook (Nasdaq:$<\/span>FB<\/a>)<\/b> is discovering as well, the shift of user eyeballs from their desktops to their phones and tablets has not been good for the advertising model.<\/li>\n
  2. Email is still critical as a communications medium, particularly in business.\u00a0 But Microsoft (Nasdaq:$<\/span>MSFT<\/a>)<\/b> tends to dominate here, and consumers tend to communicate more via social media apps like Facebook and Twitter and via instant messaging.\u00a0 E-mail is so\u2026pass\u00e9.\u00a0 And again, Gmail is like the rest of Google\u2019s offerings in that it depends on advertising.<\/li>\n
  3. Android is the king of smartphone operating systems\u2014for now.\u00a0 Yes, Android has roughly 75% of the smartphone market.\u00a0 But again, Google doesn\u2019t sell <\/i>Android; it gives it away in the hopes that it will coax users into its advertising-based ecosystem (and to a lesser extent into its paid app store).\u00a0 And the Google Play Store has been far less effective than Apple (Nasdaq:$<\/span>AAPL<\/a>)<\/b> in convincing users to actually fork over money for paid apps.\u00a0 (As an aside, I\u2019ve never paid for an app.\u00a0 Why would I, given the great selection of free ones?)<\/li>\n<\/ol>\n

    Meanwhile, high-end makers of Android phones\u2014such as South Korea\u2019s Samsung\u2014are launching Windows Phones in early 2013.\u00a0 It\u2019s not hard to see why.\u00a0 If you are Samsung, you don\u2019t want to be completely dependent on one third-party operating system developer\u2014particularly a flaky one like Google.\u00a0 It is in Samsung\u2019s best interest to have a competitive Windows platform to sell alongside their Android phones.<\/p>\n

    And let\u2019s not forget Apple.\u00a0 Though Siri, first released on the iPhone 4S, is mostly just a toy right now, don\u2019t put it past Apple to forge it into a Google slayer.\u00a0 Right now, Siri actually\u00a0 defaults to Google as its default search engine, so it\u2019s hard to make an argument that it is a would-be competitor.\u00a0 To this I have two answers.\u00a0 First, it completely bypasses the ads that pay Google\u2019s bills\u2026which means that Google really needs to consider a new revenue model.\u00a0 And second, for how much longer is Apple going to be content to direct traffic to its chief competitor?<\/p>\n

    And finally, Google has a big, red target on its chest from government regulators.\u00a0 The U.S. government and Google have largely made peace\u2014for now\u2014but the EU still has an axe to grind.\u00a0 \u00a0Google is in the midst of a long, drawn-out investigation<\/a> by the EU\u2019s antitrust regulators that may potentially erode its advertising model further.<\/p>\n

    Again, I use Google daily\u2014and in fact used it extensively when writing this article.\u00a0 But if Google is to remain relevant by 2020, it will have to be a radically different company from the one we see today.<\/p>\n

    Disclosures: Sizemore Capital is long MSFT. \u00a0This article first appeared on InvestorPlace<\/a>.<\/p>\n

    SUBSCRIBE <\/a><\/strong>to Sizemore Insights<\/em>\u00a0via e-mail today.<\/p>\n

    The post Will Google Still Exist in 2020?<\/a> appeared first on Sizemore Insights<\/a>.<\/p>\n

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