Should Google Be Scared Of The Mobile Internet?


Two weeks ago, a mobile industry veteran declared that the mobile Web as dead, and now this week, BusinessWeek is arguing the exact opposite — that the mobile Internet and not Microsoft (NSDQ: MSFT) or Yahoo! (NSDQ: YHOO) is a real threat to Google (NSDQ: GOOG). The logic: Since phone’s have smaller screens, there’s less real estate to display ads, shrinking the search giant’s overall ad inventory. For example, Google can fit about 10 ads on a standard computer screen, whereas a cell phone can only fit one or two. “Imagine the horror that would befall your business if a large slice of what you sell suddenly disappeared,” the story goes.

But isn’t this logic flawed? People don’t search from a mobile phone instead of a PC, they are searching on a phone in addition to the PC. Google’s inventory should actually increase, albeit by one or two ads at a time. That’s because people’s behaviors are different when searching at home vs. when they are on the go. Generally speaking, on the phone, people want relevant, local information, like directions or restaurant recommendations. Whereas, at home, people can sift through millions of results to research something. Google is already accommodating these differences. For example, when searching Google’s mobile search page for Volkswagen, they refer you to the nearest dealership. From Google’s PC search, you get Volkswagen’s home page and the third link is to Wikipedia. Google’s likely less scared of its inventory shrinking and more afraid that it won’t be as dominant on the mobile phone as it is on the PC.



Interesting article, i have been following mobile for a while since i work in the industry. I tend to agree mobile is not a threat for GOOGLE, THOUGH with mobile this is a perfect opportunity for another player to come into the market since they dont dominate it as yet.

I also wrote up a post on what's currently missing in Mobile ads from google.

Joe Santilli

Beattie's venture into mobile browsing (Mowser) was a failure. Unable to raise the funding to back his venture and unable to generate traffic to his site, Beattie decries the mobile web as "limited" and "dying."

Interesting conclusion: Beattie fails at mobile web therefore mobile web is not a viable platform or market.

Had Beattie either raised the venture funding or generated traffic to his site he wouldn't be singing this song.

Anyone successful in mobile marketing will tell you the mobile web is just beginning. Already, over ten advertising network companies are in the mobile web market with plans to grow it. Traffic is up by anyone's measurement.

Although Google and other web properties are now selling ads on their mobile properties for about 25% of the price of their internet properties, it is only a matter of time before this increases commensurate with traffic growth.

Two years ago I owned and operated a successful mobile entertainment company. It was my erroneous assumption that small screens on mobile phones would be the limiting factor on growing the mobile browsing market. Then the smartphone handset went mainstream – no longer a tool of just businessmen. Then came the iPhone with WiFi. Now Nokia has an entire line of smart phones with qwerty keyboards. It's not just about email, it's about browsing. The iPhone is going to make mobile browsing "another" indispensable user tool. Today's iPhone users are tomorrows mobile web users. Although there will be some cannibalization for Google, mobile browsing will be largely an internet PLUS mobile phenomenon.

Upon reading his article it was immediately apparent to me that Beattie was attributing his personal failures to the mobile browsing environment. Moreover, it was an obvious case of fatally flawed business assumptions that contributed to the demise of the venture. There are dozens of social networking companies that operate on mobile browsers. Look at – one million mobile browser visits each month. I can't believe anyone printed Beattie's article as some kind of qualified observation of the viability or sustainability of the mobile browsing market.

After all Mr. Beattie, you're real problem is that you were competing with Google mobile for traffic. Please tell us exactly what made you think anyone would go to You don't need a venture capitalist. You need a David for this Goliath. And a good therapist might help you to accept responsibility for your failures so as to insure you don't repeat them.

Ben Kunz


Thank you for the thoughtful response. In the near term, you could be right, mobile may be an *additive* channel that gives Google and other advertisers a new way to reach users — on the road, GPS-connected, tiny ads that supplement internet marketing. I, for one, dig the fact that Google listings on my Blackberry tell me the store I want is 0.4 miles north. Very cool!

But in the long term I believe mobile will do to standard web pages what Craigslist is doing to newspaper classified advertising today: Replace it. Today's younger generation doesn't use email; they use text messaging. Today's social media users don't spend much time on standard web pages; they communicate with apps inside Facebook, Twitter and blogs.

In the longest view, there are only 24 hours in a day, and new media channels with which people spend time must supplant the old. 5 hours spent playing with the iPhone is 5 hours not on a PC screen. It takes a while; but read reports on today's radio ratings and newspaper readership, and you'll see what MP3s and web news have done — it's out with the old, in with the new.

Perhaps the easiest way to think of this is it is not an all-or-nothing proposition. If only 10% of viewers abort PC screens for mobile, ad responses on traditional web pages would fall 10%. This is enough to trigger a cascade of departing advertisers. As proof, witness today's newspaper industry.

The real issue, both today and tomorrow, is for marketers to learn to use *personalization* to reach consumers in a manner to increase response rates. Any marketer who is not now investing 5% of her budget into testing ad networks on the web, and new mobile formats, is taking a risk that she won't be in position when the future comes.

I could be wrong. But what if I'm right?

Thanks again.

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