Is Google Headed in the Wrong Direction?

News Analysis: Location-based services are hot, but Google may be setting itself up for another failure.

With the number of things Google is throwing at the wall, some of them are bound to stick.

And if the perceived market for location-based services is any indication, Googles plan to offer better mapping and search results on cell phones by using cell towers to determine the location of users could be one thing that does.

But doubts about the companys fundamental approach, and the specter of ads taking over small mobile device screens, raise the very real possibility that Googles offering may fail to live up to expectations.

Googles new foray into this area shouldnt be surprising, as mobility and location-based services are considered among the hottest areas in technology.

John Cooper of M&A (mergers and acquisitions) advisory firm Montgomery & Co., speaking at The 451 Groups annual client conference Nov. 27, identified mobility as one of the most attractive sectors for M&A activity in the coming years. He noted that 1.12 billion mobile units will have shipped worldwide by the end of 2007, and predicted that vendors will now begin turning their attention to enterprise users in earnest.

Tony Rizzo, who covers enterprise mobility for The 451 Group, said mobility "will achieve critical mass in the enterprise in 2009," with 2008 being a "significant ramp-up year."

He also predicted that SAAS (software as a service) would come together with mobility to create what he called SSAA, or "SAAS—anytime, anywhere."


Click here to read more about Googles mobile mapping service.

Google is, if nothing else, the worlds largest SAAS provider. Now, the company seems to be trying to make good on Rizzos prediction.

But in an e-mail to EWEEK, Rizzo expressed reservations about the efficacy of Googles plan. He grudgingly admitted that the service could be "sort of useful in a very rudimentary way, though a three-mile accuracy (at its worst) wont do anyone much good."

"I dont know how well—or even if—cell towers can triangulate while a user is, say, in a moving car ... it certainly doesnt replace GPS capability," he wrote.

Rizzo also noted that ads served by Google will be more annoying on the limited real estate of a mobile device screen than they are on larger desktop and laptop screens, where they are easier to ignore.

Not that Google is a stranger to failure.

Google was expected to make a splash in social networking when it acquired wiki vendor JotSpot in October 2006, but that has not worked out—not yet, and perhaps not ever. Kathleen Reidy, also an analyst for The 451 Group, said that not only is a wiki project no longer in the works at Google, but that former JotSpot employees are currently working on altogether different projects.


To read about Googles Android platform, click here.

But such is the size and importance of Google that it could still be a major player in the social software space if it so desired.

Speaking at the firms client conference, Reidy said 18 percent of IT and business professionals surveyed said they would use Google software for social tools, even though the company currently doesnt offer any. That would be akin to Al Gore garnering third place in a poll of voters intentions even though he isnt running for office.

This is the most recent in an impressive spate of announcements by the search market leader. This week alone, Google launched a multimillion-dollar effort to create renewable energy in a matter of "years, not decades," according to co-founder Larry Page.

Also this week, Google all but confirmed its intention to offer storage as a service. This is not to mention the introduction of Android, Googles open-source-based mobile platform, a scant three weeks ago.


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