I’m an avid Google product user and from the looks of it, I believe that Google is beginning to really worry about their profits. Maybe they’re kicking themselves for paying so much on acquisitions that have yet to show profitability or get close to breaking even. Whichever the case, there’s five prime examples of Google’s latest moves and how it might point to a shaky foundation:
1) Google has already cut 300 jobs so far in 2009
Read CNN’s article: Layoffs hit Google: 200 jobs cut.
We’re only four months into 2009 and Google has already made two cuts to their roster. Sure you can argue that 300 jobs only represents about 1% of all their employees, but with such a small line item and given the economy, wouldn’t have Google’s “Don’t be evil” motto kick in and keep these employees at least until the job outlook turned a little bit more positive?
2) Google Notebook development suddenly stopped
Google Notebook might not have been a popular product on its own, but when coupled with the Google Notebook Plugin for Firefox, it was a product like no other. Imagine being able to effortlessly copy images, text, clips, links, whatever was in your browser window to an application with drag-and-drop functionality that was automatically shared from any computer with internet access? That’s what Google Notebook is, or should I say was. In January of 2009, Google Notebook began it’s long walk down into the dungeon of forgotten web apps.
3) Google Apps Standard Edition is now buried and hard to find plus its more limited
I highly recommend Google Apps to all my clients but I’ve recently found that the Standard Edition (the free version) is a bit more buried than before. Additionally the easy-to-compare comparison chart has disappeared. Luckily there are screenshots of it floating around the web but one interesting note that isn’t
listed is that the Standard Edition now limits you to 50 user accounts and the bulk-user creation tool has been removed from the Standard Edition (even if you’re trying to create less than 50 accounts). You can read more about these new limitations straight from Google on their blog.
The financial jump from having 50 accounts to 51 and having to go Premium is a major one. At $50 per account per year, that’s a total of $2,550. Sure you could say that a company with 50 employees should easily be able to afford $2,550, but with margins being as low as they are that’s an additional $2,550 that has to be taken out of some other expense… perhaps wages?
Another alternative could be some sort of employee-motivation award. The top 50 employees of the year get an email address, the rest are on their own.
4) Google Analytics Page View Limit at 5M
Although it’s not specifically a brand new limit, it is somewhat buried and hard to find. Google Analytics has a 5M pageview limit so if your site receives more than 5 million visitors, the extras won’t be counted; unless of course you’re an AdWords subscriber. Here’s the gotcha part of the deal, you have to be an active AdWords subscriber and in Google’s definition, an active subscriber is someone who spends at least $1 per day or lets round that to $30 per month.Read about this limit under Google’s “Troubleshooting Reports” ?
5) No more call tracking for audio ads
I recently recieved the following email from Google:
One of the easiest methods to help track call-to-close ratio for my clients was by implementing the automated call tracking feature of ads purchased through Google AdWords. The integration and automation of this feature was the best part of the audio ads and which for a brief moment convinced me to have Google do some of my media buying just for that added benefit. Well that added benefit has turned into a nightmare now that Google is terminating the program with very short notice. The statistical data will dissapeare in one month (after June 2, 2009) and the numbers will be deactivated in five months.
Now it could be argued that like any other company, Google has every right to protect its profits and make decisions in the best interest of their shareholders. However, Google did report a profit in Q1 of this year. In fact, Google reported a 9% gain in profits from the same quarter last year for a total net of $1.42B. Interestingly though instead of innovating their products and offering additional services at cost, they’re going back and changing the rules of the game. So what used to be free, now it’s not. This is a much different approach than building value unto their services and pricing it accordingly. It’s like someone saying you can have a car for free and after driving it for a year, they change their mind and tell you that you have to pay for it.
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