The news that Vic Gundotra, Google’s vice-president for social media, is to leave the company has fuelled speculation that Google+, the company’s much maligned social network that Gundotra oversaw, is dead in the water.
While Google+ has not caught on as a replacement for Facebook, it remains a powerful tool for other reasons and it should not be written off just yet.
The unsocial network
Google+ was launched in June 2011, and the latest figures released by the firm suggest it has 540 million users. But whether these user numbers actually reflect the social network’s popularity has been disputed.
This is primarily because most of those users have been effectively forced into signing up for Google+. Gmail accounts, which millions of people rely on for email, are heavily integrated with Google+, for example, and there has been controversy over a decision last year to make it impossible to comment on YouTube videos unless you have a Google+ account.
Many people who are signed up to Google+ can’t, therefore, really be considered active users. Gundotra was a strong advocate of integration, and reportedly clashed with others at Google about the idea.
Other analysts have attributed the lacklustre performance of Google+ to the fact that Google didn’t commit as many resources to its development as it might have. Facebook has a vast workforce while Google+ has 1,200 at most.
And perhaps unsurprisingly, those employees ultimately produced a user interface that really couldn’t compete with Facebook. Users have reported struggling to work out how to use it and, most importantly, Google’s policy against accepting add-ons that have not been officially sanctioned has stifled innovation and user acceptance. In fact, the add-ons that Google does allow are usually connected to other Google products and services (and the Chrome browser in this case), which are forcefully integrated into user accounts.
Add-ons vary from games to applications. For instance, on Facebook you can use add-ons to check how positive or negative your Facebook status updates are, or to customise an action button, such as “dislike,” “hate” or “love” and add it to your status update once you click “share”. In Google+, many add-ons are specific to the Chrome browser and often need to be tweaked to make them work.
Born too late
Beyond these problems, there is a deeper reason for the failure of Google+. Google entered the social networking game too late. By the time it had cottoned on to the trend, other social networks had already developed powerful network effects around their services.
A network effect, also known as the demand-side economies of scale, is the effect that one user of a service has on the value of that service to other people. Network effects become significant after a critical mass of users has been achieved, at which point, the value obtained from the service is greater than or equal to the amount of resources invested in developing the service. As the value of the service is determined by the user base, more people are likely to subscribe once a certain number of people have joined the service because of the value those existing users create.
Once your friends have joined a social network and started generating content and links with their other friends, it is very difficult to resist signing up yourself because you might miss out on “important” updates.
What’s more, if you decide you don’t like a particular social network, it would be very difficult to close your account and get all your friends and their friends to migrate to another without very good reason. The value of an online social network – especially because of its indefinite scale – generates a lock-in effect that makes it easy to attract more and more users.
The most famous example of lock-in is the QWERTY keyboard. This is the most widely adopted keyboard layout in the world, even though it is not necessarily the most innovative. It just so happened that when the first typewriters were developed, the model using the QWERTY layout became the most popular so it became more and more useful to learn to type with this layout than any other. The continued dominance of QWERTY to this day is testament to how powerful lock-in can be.
Hidden value
But in spite of these considerable problems, Google+ may hold more network effects under its sleeve than first meets the eye. Precisely because of Google’s underlying strategy to integrate all Google products, from Gmail to YouTube to maps, under a Google+ account, Google now has more information about who its users are and what they do across its products and services than ever, even if they never really use Google+ itself. Some analysts even say that Google understands more about people’s social activity than Facebook.
This is very important now that advertising is produced using information mined from what people talk about, do and share online, rather than simply what they search for. For Google, this means that it can design more customised products and services based on people’s friendships on Gmail, the places they go on maps or the arguments they have with other users in the comments section on YouTube.
And this is what Google has always done best. It might not have been able to crack the social network interface but it certainly knows how to collect and classify information in a very systematic way, while establishing connections between nodes in networks of data.
The company already has a base upon which it is developing its own positive network effects and lock-ins. Google+ may not be the social network Google aspired it to be, but it is a social network search and optimisation tool that can enable companies to develop better product and service placements across user searches.
Nevertheless, Google needs to tread carefully with this strategy. The law doesn’t always look favourably upon lock-ins. Back in the 1990s, Microsoft locked customers into using Internet Explorer as their web browser when they bought a computer that ran on Windows. It later faced lengthy and expensive lawsuits to defend the policy.
Google’s policy of integrating its social network with other services has already raised privacy concerns and it may even face antitrust accusations in the future. The Federal Trade Commission in the US and the European Commission have their eye on Google+, even if its users can’t be bothered.