Google’s dominance in search and other online spaces allows it to collect vast amounts of data that help it deliver targeted advertising. In fact, advertising revenues from the Google unit accounted for more than 90 percent of Alphabet’s $110 billion total revenues in 2017. However, as growth in the core advertising business slows, company executives are seeking to diversify Alphabet’s revenue stream. Plans for some promising new products, including Google Glass, have been scaled back. Moreover, Google’s ability to link its various Web sites to the search process has attracted the attention of antitrust regulators in Europe.

Android OS

In terms of global sales, smartphones that use Google’s Android operating system account for roughly 80 percent of the market. Google provides Android—and its green Bugdroid brand mascot—free to handset and tablet manufacturers; Samsung, Motorola, HTC, and LG all use Android. One reason for Android’s popularity is the fact that Samsung and other handset manufacturers offer a variety of screen sizes and price points.
By contrast, Apple’s iOS is exclusive to the iPhone. Prior to 2014, the iPhone was not available in large screen sizes. Although the number of Android apps slightly exceeds the number for Apple, some developers prefer the iOS platform. One reason cited is the superior ease of use of Xcode, Apple’s development environment, compared with Android’s Eclipse. Also, the iOS customer base tends to be more affluent.
As mobile video games grow in popularity, Apple and Google are jockeying for dominance in the mobile space. Both companies offer game developers extra promotional support in exchange for exclusivity for new game titles. For example, Electronic Arts released “Plants vs. Zombies 2” on Apple’s App Store two months before the title was made available for Android phones. One industry observer likens the competition to an “arms race for the best content.”

Questions
1. Why was Google rebranded as Alphabet?
2. Apply the new-product continuum (Figure 10-4) to Google’s Moonshot Factory. Which category of products and services is most evident in that organization’s work?

3. Assess the prospects for driverless cars. Once the technology is perfected, which obstacles will Waymo have to overcome before autonomous mobility becomes widely adopted?
4. One goal for Alphabet’s X division is to create a new moneymaking business that rivals Google in size and profitability but does not involve search functions. What do you think that will be?

Transcribed Image Text:

Continuous innovations Least disrupting influence on established consumption patterns Dynamically continuous innovations Some disrupting influence on established consumption patterns Discontinuous innovations Requires new consumption patterns and the creation of previously unknown products