23
Oct

Social Change and your future revenues

Escrito el 23 Octubre 2006 por Ricardo Pérez Garrido en Internet

In the last two weeks Yahoo and Google presented their quarterly results. Yahoo presented a 38% decline in profits from last year’s quarter. Google almost doubled it. They compete for advertising, but with a different approach. The difference goes back to what is important in the online world: trust and interference in what the customer wants to do and get from your service. If you move fast enough you will deliver a good service, and change with the fast changes of what we expect from the market. The fact is that Google’s revenues come mainly from their big advantage in search. All the other big innovations of the company in the last months are interesting, but they come from acquisitions and they have had, at best, a limited success.
The good news is that they are fast enough to buy and integrate: take Google Maps/Earth, wich took only months from being an independent company – actually two- to become one of the most used services in its category. While Google goes for the video-sharing (community building) business with YouTube, Yahoo is in talks with FaceBook (another community site). Apparently, the promise of communities and content generated by users is finally paying back, at least to the founders of the sites. The revenues generated by MySpace and the current valuation of the company sure make the NewsCorp deal a great one in perspective (remember the voices saying bubble again before summer?).
Probably the change is as simple as looking at where the attention of customer goes. It is clearly moving from TV (remember where they get their income from?) to alternative channels and different content. Probably is more a problem of recognizing a social change and adapting to it than a strategic decision of the studios, music or TV companies. History tells us that adapting to change is not easy, but this time the numbers are telling a story of social change, in the way we select how we spend time, get information, and share ideas. Probably Web 2.0 is not such a big deal after all, but the fact that people is doing things differently is changing some fundamental things. Some additional steps will follow, and with the introduction of more interactivity and the concept of presence in your mobile phone, the next big change is served. Just wait and see, or maybe that’s not such a good strategy.

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