Dethroned Customers

Written by The Financial Express | Updated: Jan 13 2014, 09:02am hrs
Googles online services form that rare business model where the users of the service are not the ones providing the company its revenuesthat role is filled by the advertisers. This puts Google in an unusual position. Where conventional business modelsfor products as well as servicesteach that the customer is the undisputed king, Googles model shows that the advertisers are at least as important. Google thus has to design its online services in such a way that the users are happy, and advertisers see value in placing their advertisements on them. Often, these two objectives pull in opposite directions. Overall, Google has balanced these objectives well, but recent moves by the company show that the scales could be tipping. Interestingly, and maybe a little worryingly, theyre tipping away from the users. Last year, it came to light that Google reads your emailsostensibly to improve its services like synchronising your calendar automatically, etc, but also so that advertisers can place targeted ads on your page. The latest move, announced on Thursday, will allow anybody to email you, even if they do not have your email address, thanks to Google Plus. This again seems engineered to help advertisers get your attention better.

To be fair, not all of Googles recent moves have been made keeping advertisers in mind. The (highly unpopular) decision that makes it impossible for users to comment on YouTube, post photos or even share driving directions without signing into Google Plus seems like a way to increase that social networks small user base. But what is clear is that users preferences and comforts are increasingly being marginalised, step by step. The ubiquity of Googles online services might make it tempting for the company to take its users for granted. That could be a mistake.