google trivestiture

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I Googled “whatstheidea+google trivestiture” to see when I predicted Google would be split into 3 companies. Seems it was February 2010. According to yesterday’s news, “right pew wrong church.” Google is being reorganized — deconstructed into parts ,actually — but it won’t be at the hands of the gub-ment. It’s Google itself that will separate the company.

Alphabet will be launched as a brand new holding company. Google will continue on with search, YouTube, Android and apps (and Chrome?), all reporting to Alphabet. And smaller unique businesses such as Nest, Fiber, Google Ventures and Google X will stand alone – also reporting to Alphabet.

So divestiture is happening, just not as I predicted it. My trivestiture thought was all about monopoly breaking. This move is about business and accountability.

It doesn’t mean Google still can’t be broken apart, it just makes it a little less likely.

Nice move Messrs. Brin and Page.

I was wrong. Happy to admit it. Tear a stripe of my uniform. And ahead we shall march.

Peace.

 

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I wrote a piece a few years back foretelling the government’s breakup of Google. I predicted a Google trivestiture giving birth to a pure analytics company – to which marketers and ad agencies would pay lots of money. Well, the breakup hasn’t happened yet but Facebook may have just stepped into the analytics breach. Facebook is launching a new advertising platform, using all the data it collects about us, to sell ad space. And not all the ad space will be on Facebook. Many ads will appear on mobile sites, apps and other things digital.

This is going to be big. I repeat, from a revenue standpoint this is going to be big.

I’m afraid Facebook will have first mover market position on Google here and because it is a social network not a search company the government will allow it.  Google, I suspect, is going to want to tap into this new analytics revenue stream and siphon off a big chuck — and that may be where trivestiture kicks in. That said, by allowing Facebook first mover status it may prolong the period before trivestiture. Smart move.

Who else wants a piece of this analytics pie? Amazon. And Apple with its bold new ApplePay program.

Fasten your seatbelts errybodies, this is going to be fodder for some serious red state/blue state discussion over the next 10 year. Peace.

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CBS and Google.

A little over 4 years ago I predicted Google would break up into 3 different companies.  It would happen in about 48 months, the non-prescient post suggested. I was wrong. The post had over a 1,000 hits, partly because of a point I made about Google’s culture of technological obesity, a tidbit picked up by Steve Rubel and Life Hacker. Who knew?

Today CBS, a proclaimed content company, has made public its plans to spin off and IPO its outdoor business. A $3.3B advertising and real estate venture, it is deemed non-core. CBS is rolling financially, owning an amazing share of prime time TV viewership as well as a successful film business, a cable channel and online properties. CBS is making the move during a period of earnings strength. It’s still about portfolio focus.  

My Google trivestiture prediction was also about focus. But without any government pressure, Google has decided that a diverse portfolio, kept buoyant by mad ad revenue, is the best way forward.  Google can afford to pizzle away money on Motorola, and self-driving cars and, and, and.  Google is taking the GE approach, becoming a diversified technology company. And I’m liking it.

CBS gets what it is good at — content. Its diversity comes from flavors of content: prime time, movies, cable and online. Google is good at putting the world’s information at our finger tips… yet it is looking beyond the dashboard toward what’s next.  And as long as Google can turn a profit, it’s a brilliant approach. (That’s why Facebook bought Oculus Rift.  It’s non-core, but it is about the future.)

For businesses, focus gets you smarter and better. Diversity gets you smarter and better. No wrong, until the shareholders start to wince. Peace. 

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A couple, two, tree years ago I predicted the trivestiture of Google. It will still happen but perhaps not for the reason I initially thought. One of the businesses that will spin off will be an analytics business. The more the cloud powers the world, the more data actions are recorded. And I’m not just talking about purchases, I’m thinking mobile apps, geo-location, word capture in texts, searches, likes, LOLs, picture tags, etc.

Big data allows a lot of this now, we just don’t have the tools to use that data. HubSpot is a dashboard company that offers rudimentary analytics, but they don’t do much more than offer reports.  One of my first big clients AT&T once told me, “It’s not enough to capture data, you need to do something smart with it.” Google has the scientists, computing power and cash to use consumer and business data to predict purchase behavior. A data action seen in the cloud such as the search for new Netspresso machines for the office can indicate small business growth. Predictors of commerce is a business.

When an entire industry has grown up with a .250 batting average – that industry being advertising – the time has come for a marketing tool with a bit more clarity and exactitude.  That marketing tool is data-based. And it’s in Google’s sweet spot.  Unless Amazon beats them to the punch. You think Google makes money on advertising now, you just wait. Peace.

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One of the fun things about having a blog is in predicting things that eventually come true. I predicted Google’s trivestiture a couple of years ago and that hasn’t happened. Yet. You can’t win them all. But my posts about Microsoft’s brand diaspora – the unfettered and uncontrolled creep of its brands, highlighted by use of the word “Live,” I’m excited to say, looks to be accurate.  Microsoft is retiring the word “Live.” Readers know I’m behind Microsoft making a flash-cut away from the word “Windows,” as in Windows 8, in favor of the word “Tiles,” but that’s not likely to happen soon. That’s because Windows is a repository for all other creeping sub-brands.  Windows is okay to keep alive for archiving purposes, but Windows 8 should be named Tiles as should the new mobile OS.  Tiles suggests the user paradigm shift much the way Windows did in the 90s.

A new CMO tasked with making things more efficient from a messaging standpoint might walk into Microsoft and on day one fire a bunch of brand names.  It would be hard medicine but the creep (verb) has really gotten out of hand. Retiring Live is a good move. Peace! 

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Look, I’m no genius.  When I predict things like the trivestiture of Google (gonna happen) or that Best Buy will suffer at the hands of its current CMO  — predicted at the pinnacle of his celebrity – it was just simple brand and marketing logic. Larry Downes’ article in Forbes, on the other hand, is a little bit of a genius. Entitled “Why Best Buy is going out of business…gradually” it is beautifully organized, a story well-told, and emotionally charged. It’s hard to read it without being convinced.  (That said, I don’t agree Best Buy is going down, but the case is compelling.)

What I found striking in Mr. Downes’ article was a not-so-new Web phenomenon that occurred after Thanksgiving when Best Buy could not fulfill some online orders. A situation. Here’s the missive they sent to customers:  

 “Due to overwhelming demand of hot product offerings on BestBuy.com during the November and December time period, we have encountered a situation that has affected redemption of some of our customers’ online orders.”

I was at a start-up not too long ago with some under-cooked technology that fried the night of Beta release.  We were a media darling at the time. The response of our CTO was “Due to extraordinary demand, the servers went down and…”  Turning negatives in to positives might have worked in 2007 but not in 2011.

No doubt ecommerce has reshuffled the 4Ps. Some might argue Ps have been removed. Others might suggest Ps have been added. I’m sticking with 4. Get them all right — you will still encounter situations but you’ll be prepared to deal. Peace!

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In February of last year I predicted Google would split into 3 companies.  With its intent to purchase Motorola Mobility, announced this morning, Google is one step closer.  The point of my original prediction post was lost in favor of a searchable sound bite reposted by Steve Rubel: “Google’s culture of technological obesity” but that trivestiture angle may now take on some weight.

This is a very big move for Google and will continue to blur the lines between hard and soft ware companies no doubt with an expected response from “Guess who?” Microsoft. (Look for a potential full purchase of Nokia within the year.) Mobile is so hinky and malleable right now I think the Android/Moto thing will work. And then open may be out the door — guess we’ll see.

For all the tech prognosticators this announcement will create some serious buzz and take eyes off of Google+, a half-baked though still tasty cake.

Como se wow!  September should be an interesting month. Peace! 

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ITT announced yesterday that it will split into three companies.  Sara Lee is considering splitting into two companies. And as you know, I believe Google will split into 3 companies in the next 5 years.  All this makes me wonder what’s in store for the big public ad agency holding companies?  What will IPG, WPP, Omnicom and Publicis look like in a decade or two?

The drivers of divestiture are usually varied margin and profitability spans.  In the case of ITT, the military business is not as profitable as the water pump business.  In agency holding companies, I wonder if there are discreet businesses with differing margins? 

Our business has changed much in the past 5 years thanks to the computer and digital marketing.  Analysis and reports, once the provenance of humans are now much more automated.  Translating the big selling idea across platform was always the heavy lifting, but today many media forms are converging. Content is still where the money and margin is in marketing.

If I were a betting person, I’d suggest a bifurcation of creative and analytics. Move the analytics companies nearer the energy plants so the computer farms are cheaper and run the creative companies in urban centers closer to all the stimuli. Patsy Cline? Fast forward. Peace!

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The intro to The New York Times article today on the impending purchase of Groupon by Google says the motivation for their move is to “dominate” local online advertising and improve its play in social networking.  These two things may be results but, for me, they are byproducts.  Google never set out to be an advertising company, it was born of search. Search and arithmetic are its lifeblood. Like farmers hundreds of years ago who were good at farming then became king, search is what made Google a powerhouse.

That’s why I liked the purchase of YouTube. Google made is easy to search for video. This is why I like the move on Groupon. Talk about apps?  Couponing is a zillion dollar marketing application — and if Google sets it sights on making couponing more effective and efficient, it will completely change that market.

You may have read here before about Google’s “culture of technological obesity” and how that culture has driven the company to offer productivity software (work processing, spreadsheet, etc.), a mobile phone, an new OS and and and. These efforts have been off- piste (Is it snowing yet?) and the reason Google will trivest in less than a decade.  So I’m not a Google fanboy — but they deserve much respect for this move.  This is mad max stuff.  Now, stay away from my television until you are ready to provide a truly useable search product and we’re good. Peace!

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