Facebook vs Google battle- Who has the advantage and why only the paranoid survives?

by Ashvini Kumar Saxena on February 26, 2011 · 16 comments

in Business

As I look at the Facebook VS Google race that is going on today, I recall something.

I read a book sometimes back called as “Only the paranoid survive” by Andy Grove. In the book Andy talked about how Intel faced intense competition but managed to came out as winner all the times. Leaving aside the controversies, Intel is the champion of personal computing. It had its fair share of competition with Motorola, Japanese Manufactures and then finally with AMD. Andy talked about how was Intel quick to spot the changes when they occurred. More than often he referred to these path breaking changes as 10X.These were changes that were so powerful that they changed the way we live and work.

It does not need to see long the changes that have happened in last decade and are accelerating with time. Intel faced 10X change when they faced competition from Japanese factories. Intel responded by becoming cost effective and responding to the customers. What Andy says that we should always be on the lookout for 10x changes. They can literally knock down the company in a few years.

Taking a look at Google vs Facebook battle, it seems clear that Google is facing the same 10x change that had catapulted it in the front of internet ahead of microsoft. Internet was shaping the world and microsoft had remained more of a desktop giant. Despite years of efforts, Microsoft did not achieve the lead over Google.

For around ten or so years Google has been undisputed leader of the internet. It has the capability to change the business models of thousands of companies with one small change in algorithm.

The new kid on the block Facebook has one advantage over Google which is difficult to replicate. Facebook is closer to the customer or users. Facebook knows much more about its customers than Google can ever know. 500m + userbase churning out millions of thoughts everyday which can be analyzed into a pattern serves as a mouthwatering dish for advertisers. It is possible to personalize ads based on user preferences because it is directly derived out of what users post or mention online.

Hence Facebook is a 10X threat to Google. It is not the end of the battle but just start of it. It would be interesting to see if a nimble startup can upstage a giant or the giant will eat the start up. Not that anyone has lost anything but as a reigning champion Google has enough to worry about.

In the end Andy Grove sounds really true. The winner of the game is the one who spots this change and take steps to ride the wave. Companies who stuck to old ideas will lose much faster than one which is open to new ones. The battle will be won by the company that not only knows its customer closely but serves them faster and better.

 

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{ 13 comments… read them below or add one }

Suraj @SmartFatBlogger April 22, 2011 at 1:14 pm

Thanks for sharing this article.Very Informative!

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Phani April 1, 2011 at 10:52 pm

Hi, I really appreciate and respect all the above views and thoughts. Google and FB are going rocket speed, but they are to their perspective. As far as advertising is concerned I do agree that FB is a tough competition, but they have their own nature of clients. So I will assume that none of them will have a downfall in their income levels. Google’s Android is going great guns and it might capture the worlds mobile market apart from Nokia phones which don’t use Android as OS , the applications are excellent compared to others. I speculate that FB will overcome Orkut in very less time. So both have their own capabilities, strategic plans who are currently ruling the internet world. Thus both will stand with their heads up in the market unlike Microsoft who could not win hearts.

Please correct my thoughts if you feel any.

Phanideep

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Ashvini Kumar Saxena April 3, 2011 at 10:14 pm

Hi Phanideep,
Let me thank you for commenting here. Both of them are really dynamic companies. The question however is who is going to win the battle in ad reveneus. Google development of android is a step in that direction while FB’s increasing number of features will make sure that it stays in the game. The fight is going to be interesting. Let us wait and watch how it goes and how it affects each of us.

Thanks and regards,
Ashvini

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Boutique Web Design March 15, 2011 at 3:24 pm

FB is real competition to Google and FB is growing very fast. FB is addictive but Google is not. I think FB email will be a big hit.

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Nicola Deiana March 1, 2011 at 4:26 am

Great post Asivini. It’s an advertising war! Who win will dominate the web. I have tried both FB ads and Google adwords and the first one currently results in far better CTR’s and CPA than Fb. What do you think? ;)

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Ashvini Kumar Saxena March 1, 2011 at 5:40 pm

Nicola,
It is a war for sure. Let us wait for the winner and how will it be beneficial to us.

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Aswani February 26, 2011 at 11:44 pm

Ashvini, this is one of the best writeup on your blog. I’ve been closely following these developments and I have to say that finally its all about the revenue generation. There is absolutely no comparison between these both as very rightly, one is the leader in search engines and the other is the king of social networks. The real fight is to lure as many advertisers as possible where facebook has been gaining edge over Google in recent times. Also, I came to know that most of the advertisers who were making use of Google Adwords, have started moving to facebook for the same. This could again be because of demographic advantages plus the cost involved. Ultimately, there’s a challenge for Google to raise above all these and make it to the top once again.

Yes, I agree with your theory of paranoid. Both Intel and Facebook are right examples for the same. Its all about the innovation without which companies are doomed to fail.

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Alka February 26, 2011 at 7:56 pm

I heard that FB is going to take over g mail…..Google will have a tough time then.

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Ashvini Kumar Saxena February 26, 2011 at 11:06 pm

Hi Alka,
FB already is providing email services. However I still don know if I can use that with email clients. I guess it has got some more work to do.

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Swami Balendu February 26, 2011 at 12:58 pm

Dear Ashvini,
Very good post. I think Google and Facebook both have their potential in different ways. Of course there is more possibility in Facebook for sharing and discussion but this is a social networking site where users come normally for networking or getting in touch or playing games or you can say for passing time and having fun for free. But they are not very serious for business or spending money. Lots of people are there even not for facebooking but for fake-booking.
Google on the other hand is there for commercial use and corporate and serious business advertisement. So I do not think facebook will take over Google and will be leader of the internet world.

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Ashvini Kumar Saxena February 26, 2011 at 1:14 pm

Dear Swami Balendu ji,
First of all, let me thank you for visiting my site and posting your thoughts.
I agree with the fact that Google is a serious business and FB is mostly for fun and networking. However as an entrepreneur I would like to start with Networking as well. If I have a software launch, I would first go for immediate community which is FB to advertise, because they would listen.
While it would take a lot of time and effort for my software to be listed on Google’s search engine. That is , all product makers want faster reach to customers/consumers. Facebook is that way to start.
I would however still use mix of both and try to see what suits my strategy the best.
Thanks again for commenting.
Thanks and regards,
Ashvini

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Ram A February 26, 2011 at 1:42 am

Hi Asivini, You have started very good debate between Google and Facebook and I think presently Facebook has edge over Google because google looks like a close chatting platform where in Facebook we fill a live chat and discussion which is lacking in Google . It is true leader never remain leader for ever. so earlier was Google days but now Facebook. a very good post.

Ram A
http://www.maibolunga.blogspot.com

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Ashvini Kumar Saxena February 26, 2011 at 1:07 pm

Hi Ram,
Thanks for your comments. I am not yet taking any sides on the battle. If someone asks me to bet, it will not be easy decision. This is how businesses play out. Google made a meat out of Microsoft because of its technical superiority which facebook is a threat because of its closeness to the customer. It would be fun to watch how it ends but I agree that FB has slight edge over google

Thanks for commenting
Ashvini

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