Google Inc.

(Case Study)

Ajay Daruka - BM19002

Akash Gupta - BM19004
Ipsita Lekharu - BM19022
Labani Jana BM - BM19026
Sayanti Bandyopadhyay - BM19041
Seemant Bind - BM19041
1. What were the key factors behind Google’s success?
The key factors behind Google’s success are elaborated as follows:
 It had a corporate culture that allowed quick decision making and focussed on innovation.
 It focussed more on the users and offered them free services under one umbrella.
 The CTR(Click Through Rate) model- better than Overture’s CPC.
 Good acquisition- Acquisition of DoubleClick, YouTube

2. Do you expect the search business to become more concentrated (dominated by fewer
players)? Is search a winner-takes-all business?

Yes, we expect the search business to become more concentrated.

 Google is the unquestionable leader. It is followed by Yahoo and Microsoft MSN. Other stakeholders
in the industry have smaller market shares.

 Since, Google is the giant search engine, it would be very tough for new players and they would
probably start merging or acquiring smaller companies.

 Google has become the benchmark of search engines and seeing its growth, developers would try to
create search algorithms that can be better than that of Google, thus making it more difficult to
operate in isolation.

Yes, search is a winner take-all business.

 Before Google came into existence, Yahoo was the market leader in search engine followed by
Microsoft. However, when Google launched its search engine with much better algorithm than its
competitors, markets share of Yahoo and Microsoft declined drastically and went to Google.

3. In renewing its deal with AOL, could Google afford to pay more than 100% of the revenue
generated from AOL searches? How did Microsoft’s maximum affordable bid for AOL’s search
traffic compare with Google’s?

Yes, we think Google would afford to pay because it had the monetary capabilities.

Microsoft's maximum bid was unknown. Google's offer for AOL was handsome. Microsoft desired to
form a partnership with AOL. Microsoft would have benefited more from the partnership as it had
a perfect chance that time to become the leader in the search engine.

4. In addition to enhancing its core search business, should Google also branch out into new
areas? Should it I) build a full-fledged portal like Yahoo? ii) Target Microsoft’s desktop
software hegemony or iii) become an e-commerce intermediary like eBay?

 No, Google should not build a full-fledged portal like Yahoo because with the outline it already has,
it is fairing well and doesn’t need to do so to gain any advantage. Instead, it should focus on its core
competencies i.e.,its wide range of services like Search engine, Gmail, Google drive, Calendar, etc.
 Yes, Google can strike to target Microsoft’s desktop software hegemony. For example, when a
document is downloaded, it opens in Microsoft Office Word. In a place where Google already owns
Google Docs, Google Drive and Google Slides, Google can attempt to make an Operating System (OS)
of its own, with the condition that anything from Google will solely open through a Google OS
software like Google Slides, etc. and nothing else. Moreover since Google already has a hand in the
making of Android in phones, they can also move a step ahead to launch an OS in PCs as well.

 No, Google should not become an e-commerce intermediary like eBay. One of the major reasons for
Google’s success in the search business is its corporate value to give unbiased results. If Google starts
its own e-commerce intermediary, when a product will be searched, Google will definitely present
its own e-commerce intermediary as the best among others, for obvious reasons like profits. Hence
this will bring biasness.

5. Do you view Google’s governance structure, corporate culture and organizational

processes as strengths or potential limitations? Why?

Yes, according to us, Google’s governance structure, corporate culture and organisational processes are
its strengths rather than potential limitations.
1. The governance structure was designed uniquely.

 The structure was designed such, that Google’s top management trio would own roughly one-third
of the shares but control over 80% of the votes which would, eventually, immunize Brin, Page, and
Schmidt from replacement by investors who questioned the company’s strategy.

 This seems to be a strength because the ultimate power of decision would rest solely in the CEOs
and they would work for their company in a manner that they deemed best.

2. The corporate culture was flexible and unique in its own way. It was such that it gave the
employees the freedom to think with an open mind.

 Allotment of 20% of their time, to work on projects that they wished to, was an add-on for the
employees. The CEOs realised that pressure was not the only tool to get work done, but giving them
the freedom to work would, indeed, get the best out of them.
 Google had the culture of attracting bright minds because of its innovative and creativity goals.

3. The organisational processes were righteous and just. It concentrated in promoting that Google
results were always unbiased and that “No one can buy better PageRank”. This drew a lot of
people to actually come and advertise their products in Google.