Discontinued Products And Services

Published Date: 02 Nov 2017

Google is one of the most famous companies dealing with technology in the world and is focused on the ways people connect themselves to seek information. Google’s innovates then in web search, advertising and recently in operating systems and has made their Google web site the biggest one on the Internet and is now the most recognized online index around the world.

Mission

 

Google’s has a clear mission in the world, is to organize all the digital information and make it easily accessible and useful for users. They believe that the most effective way to accomplish their mission is to put the user’s needs on the first line. Google has, with its experience, found that offering a large and high quality user experience leads to increase the web traffic and a strong worldwide recognition.

Revenues

Google generate its major revenue by delivering online advertising. Companies and businesses use their program (Ad Words) to promote their products, services and websites with targeted advertising. Google Ad Sense program delivers relevant ads that generate a lot of revenue. Here under is a graph representing Google’s revenue from year 2004 to last year by sectors (the data are from Google’s financial tables):

Google's revenue, 2004-2012 (in millions of dollars):

We can note that the revenues increased continuingly since 2OO4 which will able then to spend more and more on their key expenses and on their growth.

Expenses

Google business has 4 key costs elements:

Research & Development,

Data centers operations,

Traffic Acquisition,

Sales & Marketing.

Google invests a lot in Research & Development to create new products and also to improve existing ones. Concerning the second key cost element Google has today over a million servers in data centers around the world that process about one billion search requests each day which is gigantic. Google has invested heavily in these data centers. Google invests also strongly in traffic acquisition to continue increasing their offer regarding their AdSense program and to distribute Google Toolbar. Google Sales & Marketing costs include the cost of managing global sales and support teams as well as advertising and promotional expenditures.

Expanding

Google expands itself also though merger & acquisitions. The following table represents the biggest acquisitions done by Google over the past ten years:

Acquisition date

Company

Business

Country

Price

April 2003

Applied Semantics

Online advertising

http://upload.wikimedia.org/wikipedia/en/thumb/a/a4/Flag_of_the_United_States.svg/22px-Flag_of_the_United_States.svg.pngUSA

$ 102,000,000

October 2006

YouTube

Video sharing

http://upload.wikimedia.org/wikipedia/en/thumb/a/a4/Flag_of_the_United_States.svg/22px-Flag_of_the_United_States.svg.pngUSA

$ 1,650,000,000

April 2007

Double Click

Online advertising

http://upload.wikimedia.org/wikipedia/en/thumb/a/a4/Flag_of_the_United_States.svg/22px-Flag_of_the_United_States.svg.pngUSA

$ 3,100,000,000

November 2009

Ad Mob

Mobile advertising

http://upload.wikimedia.org/wikipedia/en/thumb/a/a4/Flag_of_the_United_States.svg/22px-Flag_of_the_United_States.svg.pngUSA

$ 750,000,000

August 2010

Slid.com

Social gaming

http://upload.wikimedia.org/wikipedia/en/thumb/a/a4/Flag_of_the_United_States.svg/22px-Flag_of_the_United_States.svg.pngUSA

$ 228,000,000

August 2011

Motorola Mobility

Mobile device

http://upload.wikimedia.org/wikipedia/en/thumb/a/a4/Flag_of_the_United_States.svg/22px-Flag_of_the_United_States.svg.pngUSA

$ 12,500,000,000

Markets

Technology

As we know, Google has began as a technology company dealing with web search and has evolved as you can see on the circular diagram into Smartphone software, advertising and Media Company all in one. It is extremely important for Google to innovate in digitals and electronics technologies because it’s the core of their business model. To achieve such matter, Google seeks for talent and also for the best computer engineers and scientists of tomorrow. This will lead them to be more and more a leader of internet particularly by developing artificial intelligence, machine learning, data mining, software engineering, distributed systems, cluster design…

Products, Sales and Support

 

Google had to invest and put significant effort into developing their sales and support infrastructure. Google possesses 21 sales offices allocated in 11 countries, and deploy specialized sales teams across 18 vertical markets. Google bring businesses into their advertising network through both online and direct sales channels. The below table is a brief summary of the different products that Google offers today on the market:

Web-based products

Operating systems

Desktop applications

Mobile applications

Search tools (Google search)

Android

Google Earth

Mobile web applications (Google +)

Advertising services (AdMob)

Google chrome

Picasa

Mobile standalone applications (Gmail)

Development resources (Google App Engine)

Google TV

SketchUp

Hardware (Nexus Smartphones)

Map-related products (GoogleMap Maker)

-

Google Toolbar

Services (Google Crisis Response)

Statistical tools (Google Analytics)

-

AdWords Editor

Discontinued products and services (Google Docs)

Communication and publishing tools (YouTube)

-

Wireless access

-

Competition

 

Google faces many competitors in all aspect of their business. They have competition in web search engine and in phone operating system has showed on the preceding diagram. Their market share is superior around the world except in some countries like China, Russia and Japan were they mostly use another search engine. Currently, Google’s primary competitors in search engines are Microsoft and Yahoo and in Smartphone operating system it is Apple and BlackBery.

 

Holders

Here under is the representation of Google Major Stockholders at the end of year 2012:

 

Holders

Shares

% Out

Value

Reported

FMR LLC

17,324,529

6.54

$ 13,071,357,130

Sep 30, 2012

VANGUARD GROUP, INC

11,485,598

4.33

$ 8,665,883,691

Sep 30, 2012

STATE STREET CORP

10,997,226

4.15

$ 8,297,407,017

Sep 30, 2012

PRICE ASSOCIATES INC

9,306,355

3.51

$ 7,021,644,847

Sep 30, 2012

Black Rock Institutional

7,262,268

2.74

$ 5,479,381,206

Sep 30, 2012

By its size Google has still some market risks:

Foreign Exchange

Google is a lot exposed to foreign currency transaction gains and losses. This is the result of certain net receivables of the U.S. parent due from its subsidiaries and customers being denominated in currencies other than USD, GBP, YEN and EUR.

 

Google has another exposure to foreign currency which arises from the translation of certain net assets of their subsidiaries to USD during the company’s their accounting consolidation.

Interest Rate & credits

To cover themselves from the market fluctuations and from floating and fixed rates Google invests in many financial derivative products to hedge themselves thought the future.

Google invests also in a variety of securities in interest-bearing demand deposit accounts with banks, tax-exempt money market funds and highly liquid debt securities of corporations. Google limit as well the amount of credit exposure to any issuer.

The Sherman Antitrust Act

Google is nearly the only search engine used and known by all people over the world. We could easily ask ourselves if Google has the monopole on the web search engine market. Therefore, Google could see itself dismantle by the US Government by violating the Privacy and Antitrust which are laws that promotes or maintains market competition by regulating anti-competitive conduct by companies.

The change in internet use

The ongoing transformation in technologies and in the way user’s user the internet could be a potential threat to Google. What if users change their behaviour and instead of connecting directly to Google to surf on the web, these same people used another search engine such as Bing, Baidu, Yahoo, Ask or even search recognition like Apple’s Siri or the windows phone voice recognition ? These are increasingly accurate risks that Google deals with.

The upcoming competitors

What if major internet Web Sites came on to this search engine market? Because of its size and reach, if Facebook, Twitter or even QQ were to invent this-still-unknown ad format or business, it would likely have massively negative consequences to Google. We can also think about the birth of many start-ups who could turned revolutionary and take the place of Google at the Silicon Valley. Then, a real threat to Google is the rise of simply another Google.