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This article was published on November 14, 2010

Google and Facebook: The Gloves Come Off

Google and Facebook: The Gloves Come Off

Facebook is trying to stake its claim on Google’s turf.

The consensus in the technology world is that Facebook’s Monday event will see the release of a Facebook email service of some kind, a direct shot at Google’s Gmail. While this is the most blatant shot that Facebook has taken at Google, it’s hardly the only one. Moreover, Google has fired a few volleys of its own at the social network giant.

This most recent bout between the two companies, as well as recent tensions and accusations of employee poaching, raises one glaring question: Since when is the technology industry a gang war? That is, why are Facebook and Google horning in on each other’s turf?

The competition between these two companies is not all that surprising, given that they are two of the biggest, most powerful technology companies in the world. What is surprising is the lack of subtlety with which they are trying to poach each other’s user base.

This started in earnest about eight months ago, when Google released Buzz. The technology press went absolutely gaga for the product, stating that Google had revolutionized social networking by placing it right in users’ Gmail accounts. Of course, with the benefit of hindsight, we can see how wrong that prediction was.

The service was flooded with privacy complaints, quickly became unused and is now little more than an icon on the side of users’ Gmail accounts which remains perpetually unchecked. In fact, it’s so unused that even spammers have stopped using it.

Amusingly, the buzz (no pun intended) around Facebook Mail sounds eerily similar to what we were hearing about Buzz around the time of its launch. People are saying that the potential semantics that could be built into a Facebook mail client would wipe the floor with Gmail.

In fact, the line “email inside of a social network could be a game-changer” has been bandied around by more than a few writers. Sound familiar to anyone else?

Both Facebook and Google possess a likeminded drive to innovate. Both companies have revolutionized their respective industries. Both companies have had (to put it lightly) privacy disasters in recent months. But the fact of the matter is that Facebook and Google are very different.

There are undeniable differences between the two companies. Google’s business model revolves around one single source of revenue: ads, ads and more ads. They pay for the entire show, and while the company does plenty of other things, its whole business model revolves around serving these ads. In fact, many of the company’s products– such as Android–exist largely because of their ability to serve ads.

Moreover, Google is unabashedly wonky. They succeed in the markets they succeed in because they have built a product that has more functionality and works better than anyone else.

This sort of logic serves them particularly well in the Search, Maps and Mail markets, among others. Their products in these sectors are far more clever than any of their competitors, and they’ve essentially achieved ubiquity. Of course, this cuts both ways. Buzz failed horribly for these reasons, as did Wave. In fact, the only thing Wave did well was accurately invoke the feelings that a senior citizen has while trying to use the Internet for the first time.

These products incorporated more features and tie-ins than any competitor did (although Wave really had no competitors). In the end, though, these layers and layers of functionality scared off most users. Nobody really understood what made Wave or Buzz must-have products.

By contrast, Facebook’s products have always reflected the company’s roots. If the Social Network is to be believed, Mark Zuckerberg created The Facebook to win the respect of the popular cliques at Harvard. Today’s Facebook still reflects these roots, even after six years. It’s relatively straightforward, it doesn’t use complex layers of functionality, and at its essence, it’s a tool to organize your social life. It’s collaborative, but as a result has a free-wheeling attitude towards privacy.

This comparison encompasses the differences between the two companies. And therein lies the rub. Most Google and Facebook users aren’t conscious of the amount of information they put into the hands of these companies. In the same way that you wouldn’t let the nerd (Google) plan your social life, you probably would be reluctant to trust the loose-lipped party-kid (Facebook) with your private data. Buzz was a disaster because it tried to apply Google’s strengths to a discipline where they were poorly-suited, and Facebook Mail will fail for the same reason.

So why is each company stepping so far out of its comfort zone? In Google’s case, it’s because they’re looking for a new way to implement their business model. They see the faintly ludicrous amount of time Facebook’s users spend on the site and see the creation of a popular social networking site as a chance to serve millions of ads every day. Whether Google Me will actually fulfill this promise is yet to be seen, but in order to be successful in this particular industry, they’ll need to take a new approach.

Facebook’s motivation is less clear, as is their business model. Facebook has figured out how to monetize their service, serving enough ads to make the service wildly profitable. In addition, they take a slice of all transactions made through their games platform or API. As a result, it’s difficult to understand how an email service would help Facebook’s bottom line.

The decision to make an e-mail platform either makes Facebook look like a copycat or draws into question Facebook’s direction and focus. While an e-mail platform would enhance Facebook’s ability to compete with Adwords, through more targeted advertising, it seems unlikely that the company could match Google’s efforts in this regard. Whether this represents a paradigm shift for Facebook or an attempt to expand the platform remains to be seen, but as long as Facebook pursues its current strategy, creating an e-mail service doesn’t seem like the most logical expansion.

Thanks to ScreenCrave for the image.

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