Tue Nov 22 2011

Buffy, social, and Google

AllthingsD reports that Facebook is working on a mobile phone, internally called “Buffy” - unsurprising news anyone who has been following the industry. There are, however, a number of interesting things lurking between the lines that are important to think about at this point.

Facebook is clearly taking advantage of their lead when it comes to social. Despite the surprising growth numbers on Google+ (Vic Gundotra and Sergey Brin talked a little bit about how positive they were at Web 2.0 Expo), they still have a lot of catching up to do. Google’s in a tough spot. Here’s why:

Even though they’re the clear market lead in search and online advertising, Google is losing what’s possibly the most important race they’re competing in. Social networking have become a layer on top of which all the services we use stand. From the movies we watch, to the music we listen to, to the books we read and the websites we visit, chances are high that these choices emerge out of online social interactions. Now if you think about it, Google doesn’t control any major platform supporting this kind of social interaction - with the possible exception of Youtube.

I can’t think of the last acquisition Google made in the last few years that tipped the social scale in their favor. Blogger’s acquisition is now long in the past, and since then Google has sadly been playing catch-up. By not acquiring Twitter a couple of years ago and instead focusing on products like Wave and Buzz (two social initiatives out of Mountain View that ended up failing), Google became a 3rd spot player in what might be the most critical market in IT going forward.

My guess is that we’re going to see some heavy priority changes out of Google (the social bonus suggested by Larry Page when he took his new job as CEO is a key indicator of that), and possibly more acquisitions in the social space.

So let me circle back to Buffy. Facebook is large enough now that they can focus on taking on a new market (much like Apple did with music, then phones, then tablets), and they’re comfortably sitting in the lead as a social network. Until now, however, Facebook had to rely on third party platforms (like iOS and Android) to bring their non-desktop experience to their users. Not after their phone comes out. They’re now taking a lesson from players like Apple and cutting the middle man altogether - and with a bit of irony, they’re forking Android in order to build their new mobile OS.

This whole thing makes for an interesting imaginary Venn diagram. Facebook, Twitter and Google are in Social; Apple, Amazon, Google and Facebook are in mobile; None of these companies is naive enough to only focus on their old core business. The new core business for all of them is having access to how we communicate, how we access data, and more importantly, how we share that data back with others. Social, search and mobile used to all be different things - but that’s certainly not the case anymore.