NEWS ANALYSIS: Google wants to claim a bigger portion of social networking, and Facebook wants to get its hands on more users in search. Both of them have a long way to go.
Google and Facebook have been hiking on remarkably parallel paths. The two most popular Web services in the world are about to engage each other on a whole new level, once the business-side playing field is leveled in the next few weeks.
Google raised $1.7 billion (and earned a $23 billion valuation) with its initial public offering in August 2004, when it was 8 years old. Facebook, born in 2004, will make that dollar amount and a lot more in May when it, too, goes public at age 8.
Both are hugely profitable because they attract some of the largest numbers of interactive users and advertisers on the Internet on a daily basis. But with Facebook expected to sell $5 billion worth of stock and obtain an Wall Street valuation in the neighborhood of $100 billion, Mark Zuckerberg's creation suddenly moves to a whole new major league of international corporationsone with virtually unlimited financial power.
Google was created by Stanford University students on the West Coast, and Facebook by Harvard University students on the East Coast; now they are West Coast neighbors with headquarters only jogging distance apart. Curiously, both campuses are situated similarly, backing up to the San Francisco Bay.
Envious of Each Other's Power Zone
Google, for all intents and purposes, owns Internet search, serving an estimated 80 percent of the world's search requests. Facebook, for all intents and purposes, owns social networking and claims about 20 percent of all Internet page views, according to industry researcher Hitwise
. Both are envious of each other's positions and have the leadership and resources to wage serious marketing wars in both sectors.
Google wants a bigger portion of social networking and has Google+ leading that offensive. Facebook wants to get better at search but has a long way to go to upgrade its rudimentary apparatus. How does Facebook plan to do this? Why, by hiring more search experts, that's how. And if they're from Google, so much the better. That's what Facebook did a year and a half ago when Zuckerberg lured Lars Rasmussen, creator of Google Maps, to its camp.
Up to now, Facebook has focused on acquiring information from users, slicing and dicing it, and selling it to customers, so search hasn't been a priority. The perfunctory text-entry search box at the top of each Facebook page enables users to find other Facebookers all right, but it's good for little else. It also will display random Web search results powered by Microsoft's Bing search enginethe same one that now powers Yahoobut it's really not useful at all, and Facebookers do not seek out the service.