Why Facebook Must Fear Google+: Low-Cost Social Dev Platform

By Clint Boulton  |  Posted 2011-08-08 Print this article Print

Tom Anderson has returned from the depths of near anonymity (ironic, considering he created MySpace,) to write some of the more thoughtful posts on Google+, where he is an active, active contributor.

Not only that, but he's reproducing Google+ posts for TechCrunch (or vice versa) and I find myself reading every piece he's putting out. He's not taking sides; he's telling it like it is, or like it should or will be.

That's valuable insight for those of us who follow the escalating social networking war between Google and Facebook.


And that's exactly the topic of Anderson's latest post on TechCrunch, where he notes Google has a not-so-secret, but as-yet-announced weapon for Google+, which is the ability to chop Facebook's legs from underneath it in gaming and virtual currency.

Anderson wrote:

Instead of taking a 30% cut of all Farmville seeds (or whatever people are buying), Google will be able to take a smaller percentage for themselves. They may even take nothing. And when it comes to "monetization" on the G+ "Website," Google's trump card against Facebook is that we may never even see an ad on G+. Google has plenty to gain without ever showing an ad and, put simply, Google doesn't need the money. Facebook's got to know this, and it's got to have them just a little bit concerned.

We haven't seen the gaming platform firsthand yet, but the code is out there in the wild as incontrovertible proof.

Google, which had already announced in-application sales where it only takes a low, low 5 percent fee per transaction, could and would certainly give gaming software away on the back of its $30 billion a year search ad and growing display and mobile businesses.

In fact, that's a great way to lure developers to the as-yet-unavailable Google+ API, which would trigger a developer platform crusade.

Anderson fills out his post with a lot of would have, could have, should have (and would should and could) for Google, Facebook and even his own MySpace perspective,

The part that caught me short in the quote above is the bolded part about Google not putting ads in Google+. That's not the first time Anderson has mentioned he is sure Google won't monetize + with ads.

When I first read him write that last month, it struck me as counterintuitive. Google, the world's largest digital ads purveyor, won't display ads on its new social network?

My math went like this before Google+ launched: Google is an ad company. It saw Facebook's rising success with user engagement and it's newfound ability to sell ads on the network. Therefore, Google will absolutely serve ads on Google+.

And yet.. Anderson seems certain Google won't do this. He doesn't believe Google needs to do it.

He might be right. Maybe people will leave Facebook in droves to enjoy ad-free social networking on Google+. Perhaps Google won't put ads on it for the first year or two. Facebook took years to put social ads on its site.

But I don't see this as tenable long term for Google.

Consider the current legal climate Google is facing. The company's Android mobile OS business may find its ad revenue garnished as a result of the Oracle lawsuit versus Google for using Java technology in the platform without a license.

Mobile ads are one of Google's big future moneymakers and they comprise a third leg in the stool that represents Google's ad business, joining desktop search ad and display ads.

I'm just not certain yet Google won't put ads in Google+. It doesn't have to now, but that could change.

In the meantime, I very much like Google's chances of gaining social marketshare from a lower cost development platform alternative to what Facebook currently offers.

I've already noted that Facebook is reportedly in lock-down mode to counter Google+, so whatever happens next from the incumbent could be very valuable for consumers. That could force Google to get its development platform out quicker to its own + users.

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