It occurred to me recently that something disturbing is at the core of Google's business model and overall strategy. I'm not talking about specific products like Android, Google Docs, Chrome, etc. I'm talking about Google's practically singular source of revenue: Advertising. Advertising is the only thing that makes Google any money. Most would agree that an overarching aspect of Google's model is to push advertising via free offerings like email, chat, productivity suites, even mobile phone operating systems. Products like Gmail, platforms like Android, and services like YouTube exist almost entirely to create millions and billions of portals into the Google advertising and algorithm machine.
If you consider the products Google makes and the services Google offers, one ought to consider what is ultimately most valuable to Google as a company. It's not the products and services themselves, it's Google's advertising, integrated at a deep level, that's valuable. Advertising is extremely important to Google because officially, that's where 99% of the company's revenue comes from. In fact, Google doesn't want to be in the business of selling anything except advertising.
And there's the trouble. Google ultimately sees premium content the same way it sees the products and services it gives away: A conduit to advertising views and the collection user data. Ultimately, Google's business model seeks to devalue Internet based products and services through advertising. Their business model seeks to devalue content and creativity in the exact same way.
So why is that problematic? Why would having access to all the music, movies, tv shows, books and magazines for free be a bad thing? Because devaluing content will also devalue the people that produce it. Looking forward, if all the content you consume was 'free', our society will cease to value musicians, actors, writers, singers, even athletes. If premium content becomes nothing more than an avenue for advertising, and Google becomes its gatekeeper, what motivates talented people to challenge the status quo with their creativity? Not much if Google's the only one making any real money.
The current market for TV shows, movies and music is far from perfect. Artists are paid too little while studios and labels pull down big bucks for minimal effort. But, at the end of the day, people pay to watch and listen because only a select few among us are talented enough to entertain. I pay for songs because I can't sing and I love music. I pay for movies because I can't act and want to be entertained. Most creative people do what they do because they love it. Money is a side-effect. But without significant reward, exclusivity or prestige, why would anyone become a musician or an actor?
I think ad-supported products, services and content have their place as loss-leaders. But at the same time, many people chose to pay for things so they can avoid advertising entirely. Google wants to create the expectation that advertising is attached to everything you consume. And then there's the issue of quality: most of the music, TV shows, movies and books out there, frankly, aren't very good. But some if it is just stellar and that keeps us coming back for more. Ads are the same way - most of them suck, with only a few being either entertaining or otherwise captivating.
Google wants to create an environment where you can't escape advertising because you can't do without its offerings. I get the model, but I have little interest in seeing Google devalue content while permanently marrying ads to everything I listen to, watch or read. Google's model is in direct conflict with artists that seek to be rewarded for their talents and anyone who seeks to consume or own content divorced of advertising. Fundamentally, I think Google's model will ultimately fail as people realize that good content is and always has been worth paying for -and that most of us want less advertising in our lives, not more.
So, does Google' value content? Short answer: No. The only value that content provides to Google is advertising views. Google as a content gatekeeper is scary. As a company of engineers, they have no appreciation for art, design or creativity you can't capture in code or math. Google doesn't understand creative people or the value they create in our society. Because of that, they will fail to convince the world that everything should be freely available, generic, typical, and polluted with ads. Google doesn't set out to create the best products and services. They set out to be a dominant provider by offering a lower standard that costs little to nothing. That future sounds awfully boring and drone-like. Ultimately, that's not a future people want. Google's in for a shock once people realize that 'free' actually has a very high price tag.