The Flight and Plight of Google

Google is now one of the most valuable businesses in the world. However, not many know that it was almost sold to Yahoo! for a measly $1 million (almost!) Today, one could claim Google is the best search engine in the world and it would be tough to find someone who could argue with that. Especially since it’s the most-visited website worldwide with over 2.3 million searches being performed per minute.

Google is quite often called just an ‘Advertising Company’ but this is far from the truth (although that is its prime revenue source). Currently, under the banner of Alphabet Inc., Google has acquired several startups and established businesses along the way. In fact, Google and Alphabet together own over 200 companies.

In 2005, Google became the owner of the Android operating system for $50 million. Android dominates the global smartphone market with over 70% of the market share. This is supplemented by Google Play, a platform that offers Android users over 1.5 million apps, games, music, books and movies. Additionally, the company also launched Google Pixel, a potent smartphone brand. Of course, Google is also the owner of YouTube (acquired for $1.6 billion in 2006) which is the third most visited site after Google and Facebook.

In the last few years, Google has looked to invest in multiple industries, spanning healthcare, home security, transportation and consumer electronics. It has also spent a significant sum on the R&D of new socially beneficial technologies.

This is evident in their acquisition of Fitbit (for 2.1 billion), the launch of Waymo, Google’s self-driving car project, and GV (originally Google Ventures) which invests in start-ups at initial stages (notably Uber, Lime and Slack).

Undoubtedly, Google is everywhere.

 

However, the last few months have not been kind to this tech giant.

With economic uncertainty looming, customers of Google reduced their advertising spend, causing a significant dip in ad revenue as well as problems for YouTube and Google’s search business.

For a company that’s been known for its stability and extensive employee perks, Google, unfortunately, went through a run of layoffs and slashed office space.

Recently Google’s driverless car service witnessed problems when an unexpected error caused traffic in San Francisco.

Adding to all this, the Department of Justice and eight states have filed a lawsuit against Google, citing their advertising business consists of an illegal monopoly.

In the last few months, Microsoft-backed ChatGPT became a revelation. This became even more problematic for Google when Microsoft announced their website browser and search engine Bing would soon possess the power of OpenAI and ChatGPT.

Google’s answer to this was Bard, which had a hiccup when a promotional video pushing the chatbot consisted of a partly incorrect answer to a question which resulted in a 9% slide in share value and a $100bn+ devaluation of Google’s parent company, Alphabet Inc.

With the advantage of being invested in the search business for years and access to more data, as believed by analysts, Google will eventually be fine but must act quickly to protect market share. Mark Mahaney (Evercore ISI analyst) believes that Google’s "AI technology is at least as good as the competition," and its scale and investment "should help the company defend its market position in the long run."

Of course, Alphabet and Google are huge enterprises, which should overcome their current predicaments.

What do you think of Google’s numerous investments and their current difficulties? Let us know in the comments below!