August 18th, 2006

If Google Is the New Microsoft, That’s Precisely Why They Shouldn’t Be Feared


Google is the new Microsoft, and therefore direct competition with Google should be avoided at all costs — that is Paul Graham’s takeawy from the news that Kiko, a web calendar play done in by Google Calendar, is autioning off its assets:

The best solution for most startup founders would probably be to stay out of Google’s way.

David Heinemeier at Signal vs. Noise doesn’t buy it and neither do I. David says:

No. Don’t run, don’t hide. Be different. You can’t outdo Google by trying to match them point-by-point, but you don’t have to. There are other, better ways to fight. Compete differently.

Here’s my take: If Goggle is the new Microsoft, that’s actually great news. Why? Because Micrsosoft is the old Micrsosoft, and they are now chasing Google, which demonstrates the precariousness of market leadership. And the cycle is speeding up.

So Google has more cash than you — a LOT more. And they’ve hired a LOT of smart people. But that doesn’t mean they are alway smarter. Smart people do notoriously stupid things. And it doesn’t mean they have cornered the market on innovation or creativity. Even Google wasn’t Google until someone at Google woke up one day and realized that the first geneation of AdWords was stupid and then came up with the idea of combing the keyword auction with relevancy to create the AdWords that makes billions today.

Do all of the companies going head-to-head with Google have a fighting chance? Of course not. Most probably don’t.

But if we cede the fight to Google now, they’ve used our own fear against us. And that is truly an unfair advantage.

  • kora

    first and foremost GOOG need to know how to write server based products to even think that they are new MSFT. as for as Kiko concerned they would have thought an acquisition target ( a writely or the PPT co.) which back fired. ofcource I agree that GOOG is raising the bar for would be and existing online entrepreneurs, but again from the success of myspace ( against orkut), typepad ( vs blogger) , riya ( goog photo's) , youtube, skype you can compete with GOOG. At the risk of repeating GOOG will not and cannot be a market leader in every segment they choose, and apart from GE,MSFT very few companies have a multiple billion dolor ( and no 1/2) product lines.

    the lesson learned is to sneak through GOOG , the market size of the idea should be sufficiently lesser than a billion dolor over five periods of time , also it shouldn't a feature in the collaboration area or something mimicking MSFT feature in a SAAS model.

  • tony

    no need to fear google... ask any mainstream user and their association with google is for search only and it shows in google's inability to gain any solid adoption for other services a la froogle that they had for years free to merchants mind you... if its not marketed on their homepage, it probably wont go anywhere and i very much doubt that google will change the simple search interface to dilute search marketing dollars...

  • A lot of companies are competing directly with Google, in nitch markets., for instance, in shopping. And, for definitions. Niether of these companies had first mover advantage, yet they nonetheless seem to be carving out nitches.

  • Jean Biri

    I agree too that Google's entry into the web calendar field just meant that Kiko had to be different to survive.

    The question now is: What differentiation strategy should have Kiko developed in order to stay in the game?

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