Google Now: "That's great, but how is Google going to pay for it?"
Google Now, the new, user-aware information tool Google debuted with the latest version of its Android operating system, can answer all kinds of questions. "How tall is Michael Jordan?" "How old is Ian McKellen?" "When was Betty White born?" But the biggest question is, how will Google make money off this?
Ads are Google's bread and butter. Sponsored results, sidebar ads, banner ads – some see Google as an ads business that happens to build technology products. But how does a company monetize near-ubiquitous information that presents itself before the recipient even thinks to request it? That's the billion-dollar question that will let the world know whether Google Now is the future or if it's a cool technology that not even Google can build a business around.
For those unfamiliar with Google Now, the moniker is a catch-all for Google's new voice-enabled search and "Cards" displaying what I've taken to calling "prescient information," including bits about the weather, when you should leave to make an appointment, sports scores, etc. If a piece of info regularly crosses your inbox or shows up in your Google searches, it will likely show up as a Card at some point.
"Do I think that [the shift to Google Now] poses a tremendous amount of pressure, especially with them being hit by Wall Street so hard?" Stefan Weitz, the Senior Director of search at Microsoft, asks. "Yeah, that's a challenge. It's making massive changes to something that demonstrates the lion's share of your revenue… you can do it, but it's a company-wide risk." (One that Microsoft is also taking with Windows 8, the new version of the company's operating system that has been met with something less than enthusiasm.)
Displaying ads in Google Now's "Cards" view would be a simple solution to the problem, but it may not be enough. Though no ad-based company has weathered the shift to mobile particularly well, Google's fourth-quarter results suggest that the company is starting to handle the shift a little better.
Display ads are only part of the problem, however. The shift from interacting with a keyboard and mouse to interacting with a touch-screen took decades – the shift from the touch-screen to barking commands and queries at our devices has taken just a few years. How does one monetize the answer to "How tall is Michael Jordan" with anything but "Michael Jordan is 6' 6" tall. Would you like to purchase some stilts to preserve your sense of self worth?"
Therein lies Google Now's problem, the Acchiles heel that makes competitors and pundits skeptical of the service's prospects. I'm bullish on the tool, and it spurred a three-part series from my colleague Hamish McKenzie (seen here, here, and here). But unless Google finds a monetization method for Google Now that encourages use and augments the experience in a natural way – or, at least, doesn't annoy the hell out of every user – skeptics will insist that Google is somehow pulling the tool's punches or subsidizing its development via revenues from other areas of the company.
Weitz hinted at Bing's attempts to create a device-and-user aware system similar to Google Now, and says that Microsoft might be in a better position to build the product than Google, because most of its revenues aren't borne from ads. While he's right that Microsoft doesn't rely on the same revenue type as Google, the company does rely on Windows, which isn't doing so hot either. Half a dozen of one, six of the other.
The future belongs to Google Now, or services like it. That's what Weitz and everyone else I've asked about the tool has said, and the tool's breadth represents a paradigm shift not seen since, well, Google. Now that damned "revenue" thing just needs to be taken care of.