53 Comments

Summary:

Google is making an Android-powered entertainment system and will design and sell it under its own brand, according to the Wall Street Journal. When I read the news, the word that came to mind: amazing!

amazing

Google is making an Android-powered entertainment system and will design and sell it under its own brand, according to the Wall Street Journal. This is somewhat like the hit Wi-Fi-enabled music system made by Sonos, a Santa Barbara, Calif.–company. When I read the news, the word that came to mind: amazing!

Amazing, because I just finished a post about Google’s me-too-ism affliction. Amazing, because as MG Siegler points out, the Mountain View, Calif.–based Internet giant will make hardware.

Amazing, because Google thinks that it will actually be able to crack the consumer electronics marketplace. Amazing to think that this company will build a supply chain and manage relationships with retailers and get people to buy it. (Or it can sell directly over the web, much like it did with its Nexus phones — pun intended.) Amazing, considering that the company’s track record on products beyond its core offerings — search, advertising and communication-oriented software — is spotty at best.

Amazing, to see one of smartest companies show such lack of discipline and self awareness. Amazing!

P.S.: By the way, this is the mystery Google device that Stacey Higginbotham reported last week.

You’re subscribed! If you like, you can update your settings

  1. Google doesn’t seem to understand that hardware isn’t software and hackerism costs way to much (money, time etc) when applied to hardware. Google fails to properly design some of their own web properties, can’t think of actual Google hardware designed in California.

    1. Google has actually done a good job in designing their scalable hardware architecture and building cheap, easy to replace machines on their server farms, so they do have some knowledge of hardware, but I don’t think this is a core area of expertise for them for commercial applications and think it’s a mistake for them to devote massive resources to these types of projects. Google+ is unfortunately still way behind Facebook, and nothing other than a concerted effort by Google will even start to bridge this gap. Just go back and look at how many Super Bowl ads featured Facebook URLs, look at how many smaller businesses use the types of services found at http://www.facebookfansreviews.com that do nothing other than promote Facebook pages, look at where Facebook’s IPO is going to take them. To me, this seems like a much larger strategic concern for Google and what they should be devoting their resources to because Facebook is going to be in positions, whether this year or next, to use their social data to compete in search. When that happens, Google is at risk of completely losing their dominance in their one major business.

  2. Arnold Waldstein Thursday, February 9, 2012

    I’m with you on this Om.

    Just because everyone uses search doesn’t mean that Google understands the mass market nor the mind of a consumer.

    They don’t.

    1. I’m not in or out here…but, good products, business, and all other user engagement starts with data and analytics… I think Google has this

  3. Om you’re a smart guy. Whatever Google did to you to cause you to hate them with your very soul just get over it : )

    1. Steve

      Hate is such a strong word. I am merely pointing out that somethings they are just not good at :-)

      1. Wonder if you had the same snark and knee-jerk response when Microsoft went hard into the home entertainment hardware business.

    2. Yea Om get over it. Be at least objective. You don’t know that the talent they are hiring right now might help them pull this off correctly. You are just assuming I guess.

  4. Reblogged this on quickgamer88.

  5. OM, Google is already in the hardware business …..$12.5 billions worth. lol.

    1. Yes they are — and from the looks of it that is shrinking pretty nicely.

    2. Exactly, lol now??? Many already suggested they would push into home entertainment when the motarola deal was announced.

  6. Google has done hardware in the form of Google search appliances and custom servers for many years.

    1. And again that is their sweet spot and a lot of its for their own internal consumption. I think consumer electronics brands and marketing are two entirely different things and Google just doesn’t have the chops for it.

  7. I’ll give Google the benefit of the doubt here. Their focus here is probably much more big picture than just a simple music player. The big picture here is the complete digital convergence of peoples lives. Big companies will compete in this space, small companies won’t stand a chance. Apple will run away with defining this experience (and the profits) if other companies don’t step forward. I imagine only Googlrola, Microsoft, and Sony will have a chance to compete with Apple in this market.

    This music device in combination with Motorola set top business (and GoogleTV) could show promise, but Google will need to convince me they can execute in the hardware space.

    1. I agree completely. I wouldn’t count Google out yet. I’m sure the product will be more than a glorified music player.

      1. Yeah but how does it help them take on a whole different market place and channels where neither they or Motorola have any presence. Sure, they sell phones but even that is a declining business and not sure thing.

      2. Motorola has no presence in the set-top box business?

  8. Yes, their acquisition of Motorola Mobility, one of the world’s largest makers of set top boxes, will provide no help here.

    1. Did you buy your set-top box from Best Buy or did you get it for free. Ask yourself that question and then try and see how they need to get into the channel. It has taken Sonos forever to be a decent presence and Google/Motorola has its work cut out.

      1. True. And in general it is difficult for companies reliant on indirect channels to consumer to make that transition (Gateway, Microsoft, Palm et al). But prior to the Apple Store (both retail and online) Apple had no direct consumer experience and look how that turned out. In general, I have not been impressed with the tenacity of Google in sticking to decisions outside their core competence and certainly not in direct to consumer (e.g. Nexus One). But since a core of their strategy seems to be not conceding spaces to Apple and others that could significantly affect their core search and advertising businesses (mobile and now TV), this is not as far a stray from their core competencies as you imply. Android is good example of tenacity that paid off. Also, the essential failure of using consumer electronics companies to shill Google TV shows that they are focused on creating a viable solution to get their brand into an area that has enormous and potential on their core business. I am skeptical that they will succeed, as you are, but I think it is a reasonable attempt to find a solution and they could pull it off, given the right effort.

      2. Derek – Android is something of a fluke. It was timing, the time when Verizon, Sprint & T-Mobile panicked over the success of the iPhone. The carriers made it the success it is as they had no choice. Google just happened to be in the right place at the right time.

  9. Don’t forget this is the Internet company that’s working on self-driving cars..

  10. I don’t understand why this comes off as such a big surprise. It was pretty obvious they want to go into hardware ever since we found out they want to buy Motorola.

    Did you really think they are buying Motorola with its 20,000 employees just for the patents? The Google stores opening up in Europe should’ve been another hint.

    Personally, I think this is great. Google hasn’t had a perfect start in the hardware business, but I think they are learning quickly, and have some good ideas with cutting edge hardware.

    1. I think only the Google CEO can explain why they bought Motorola. It has to be patents – someone said those are worth about 2.25% of the sale price of every Android phone. As for Motorola’s sales: did you miss the recent quarterly numbers. Not pretty.

      1. Motorola headline price was 12.5B

        –MMI has 3.4B cash & equivalents
        –MMI offers Google $1B domestic tax assets, $700M annually through 2019 (see http://goo.gl/BC863 )
        –Patent Portfolio worth at least as much as Nortels
        –STB business consistently profitable on ~$4B rev with 60% of market, worth at least .5x revs?

        They’re getting to experiment with the hardware units pretty darn cheaply, and the potential upside is massive.

        The tax assets and cash are really key to understand, though, when you’re talking about the Motorola acquisition & price.

      2. oh that 2.25% number, it’s becoming a Google constant.

Comments have been disabled for this post