
Can Google or Facebook ever have a true competitor? - rms_returns
I&#x27;m not talking about competition like DuckDuckGo or Bing. They might be good search engines, they might even write better search algorithms. Lets also assume that they achieved the monumental task of attaining the massive amounts of computational capabilities and data storage as that of Google, but they will never get the prime mover advantage that Google has, and you know why? Because you and me have already decided that whenever we want to search something, we will just visit Google.com. It has been this way since last two decades, but is it going to be the same always? If not, then what will cause us to move to a different search engine?<p>The same could be said about Facebook in the field of social networking. It is the major giant network commanding about 70% of all visitors. Most people will never leave FB because their friends are already on FB. Lets assume that a company XYZ creates a site which has lots more features than FB, but people will still say, &quot;hey, my friends are already on FB, so I have to be on FB&quot;. Isn&#x27;t this sort of unfair for that new entrant XYZ? What can XYZ make to cause people to leave FB and come to its network?
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CM30
Yes they could. It's always possible that another company could somehow do
search or social networking better than Google and Facebook, find a really
clever way of marketing their services and catch on before the former has any
chance to catch up.

It'd help if either got much worse at their core business (since that tends to
be what dooms a lot of companies nowadays), but even a strong Google could
have a competitor that simply offers people a much better and more user
friendly service.

But more likely is that they don't die to direct competitors. They die because
they become irrelevant. Their 'true' competitor isn't another social network
or search engine, it's something that completely replaces the need to have a
social network or search engine.

For example, if a company came along and figured out a way to give people
results based on what they were thinking about without any direct input
required, that could make Google's typical search box and results page and ads
completely useless. They'd be like a horse salesman after cars were invented.
Same with Facebook.

~~~
asher_
I agree that it's possible, but I think the last point in your argument
actually makes Google harder to displace than easier.

If someone came out with a better web search engine than Google right now, I
probably wouldn't switch. This is because Google search is so integrated with
other services that they understand intent way better, and you can perform
searches with far less input that you would have to give otherwise.

For example, doing a search for "my flights" or similar does not only search
the web, but also my gmail account, matches upcoming flights with data, and
returns what is relevant to me. Similar arguments can be made based on phone
data (locations, activity) and integration with products like Maps, Calendar
etc. Google Now and On Tap are great examples of features and functions that
cannot be trivially replaced by a better search algorithm.

~~~
meric
I think he meant something really advanced like an ear piece that can directly
connect your mind to the Internet. One wouldn't even need to look at a browser
for search results. Think of a programming question, and you get the answer
without doing any reading.

~~~
CM30
That's exactly it. And if something like this happens, Google's ad model is
pretty much toast. That would be bad news for them in general.

------
niftich
What counts as a 'true competitor'? You seem to be asking if there's a chance
that someone will upend Google at search, and Facebook at social networking.

But that's not how these companies pay the bills. They built massive
ecosystems around their original businesses, and they use that ecosystem to
mine data and serve ads. With this money, they've amassed social and
infrastructure capital, so they can out-build competitors (Google Drive,
Docs), branch out into other product lines (Google Cloud Services), or simply
buy them out (Instagram, WhatsApp).

To compete against them, you need differentiation and feature that appeal to a
passionate audience. Snapchat, for example, attracts people who've seen or
heard how damaging it can be to publically post on Facebook. DuckDuckGo
appeals to people who don't want trails of their web searches making it into
ads they see on websites. Dropbox works for people because they put out a
solid product and aren't trying to force you to be part of a large, monolithic
ecosystem.

But it's an uphill battle. Facebook's preferred strategy is to buy out
services before they become dangerous (they tried to buy Snapchat back when it
was still known mostly for sexting), and Google's is to outbuild others. They
form a very effective duopoly in a way.

------
hyperpallium
FB has a "network effect" the value of the network increases with the square
of the participants (i.e. the number of connections you can have). Similar
effects occur with human languages, telephones, and the internet. It's a kind
of natural monopoly, because once one gets big enough, no alternative can
catch up. That's why we have the internet, and not internets.

Google is different, because it's easy to switch search engines. One
competitive advantage they have is "google suggest" \- this takes massive
capital investment in server farms to be fast enough, which is difficult for
smaller competitors to match.

NOTE: in Google's opinion, FB was a very serious threat (hence google+),
because more information about users means better targetted ads. So _they_
don't think they're unassailable.

~~~
peterkshultz
This is a fundamental aspect of introductory economics.

In fact, many professors use Facebook as an example of monopolies due to the
network effect.

------
tjr
I distinctly remember when "whenever I wanted to search something" I just
visited altavista.digital.com. And then, somewhat reluctantly, altavista.com.

Granted, they did not have anywhere near the deep and broad reach that Google
currently has, but I would not think it impossible for someone else to come
along and tilt things in their direction.

~~~
infinii
And there was Myspace and Friendster before Facebook.

------
Lordarminius
> Can Google or Facebook ever have a true competitor? Unlikely. But never say
> never.Both companies, have built dominant market positions and have
> advantages that competitors will likely be unable to overcome.Peter Thiel
> even argues Google is a monopoly.

> but is it going to be the same always? No. If it were, then the future is
> already fixed, knowable and stagnant.Unlikely :(

> If not, then what will cause us to move to a different search engine? What
> can XYZ make to cause people to leave FB and come to its network?

Three things.

1.The company loses direction, is taken over by less competent management or
implodes under its own weight e.g Walmart, GM, Apple. 2\. Government
regulation or public pushback creates conditions for its dissolution. Think
Bell, Standard Oil 3\. New competitors emerge. A giant slayer in this case,
may initially not seem like a threat at all and may even operate in a
different market space or industry from search or social media eg gaming, VR,
IOT. Paul Graham has a good article on this.

Btw, I think FB is dying and that's part of the reason they acquired Whatsapp.
It will be obvious in 5 years and they'll be gone in a decade or decade and a
half.So is Apple,at least in its current form.

~~~
halpme
What makes you say that Apple is dying?

~~~
mywittyname
Their business is overly-dependent on the iPhone. The fact that 60% of their
revenue comes from iPhones might leave them vulnerable to shifts in consumer
behavior and/or market saturation.

iPhone sales drive sales of their other products and services. Apple is
already facing heavy competition to iTunes; overall sales are declining and
app revenue is making up a larger % of iTunes revenue in recent years. The
decline of iTunes revenue is largely attributed to the glut of streaming
services. I suspect their competing streaming service will need to be a loss-
leader in the future in order to fuel grow for their cash-cow.

Now, I don't think that Apple is dying, not at all. But I can see how their
situation is a bit more precarious than a heavily diversified company like
Microsoft (whose failures demonstrate their impressive resiliency).

~~~
PopsiclePete
How is Microsoft that much more resilient, though? They're an absolute joke in
the phone/device market. They're a market leader in the least exciting,
fastest-declining market - the Desktop.

On the server side, they're hovering at 30%-ish, and are almost completely
absent from the start-up scene as well as the high-end super-computer space.
The startup scene, which, I know, I know, but still, it _is_ where the future
is, is definitely not interested in anything MS, from what I can tell. Nothing
bug a sea of MacBooks with people pounding away at Node/RoR/language-of-the-
day. The hip 20-somethings pounding away at a thousand start-ups don't seem to
be betting on the MS stack. And those _are_ the tech leaders of tomorrow.

Forget about the start-up space, fine. What about other institutions like
banks/finance/airlines? That's all Java, running on some kind of Unix-
derivative as well, most likely hitting a non-MS database.

MS is doing ok in the video game console space, but Sony is doing better.
They're doing ok with Azure, but nothing spectacular, AWS and Google Cloud and
Dig. Ocean and the numerous others aren't feeling too much pressure.

I guess really besides Office - what do they have that's a giant run-away
success that will ensure their long-term survival?

~~~
ssivark
Most of the markets you name are not winner-take-all! Add to your list
enterprise/consumer cloud services (Office 365, Outlook, etc) and also the
Azure platform (I don't know how competitive their Azure offerings are).

Just by being a significant "also ran" in those markets Microsoft ensures its
survival in the medium term. They are diversified enough that the rug cannot
suddenly be pulled out from under them and they are in a position to pump
money and pivot into any of those markets where they see traction.

While Apple's situation is better today, their ability to respond to rapid
changes in the business is under question.

------
fitzwatermellow
The one company I believe may be on a path to a position of true "anti-
obsolescence" is Amazon. I consider the way people younger than me use it for
_everything_. Then I consider my own Prime usage which is up perhaps 100-200%
over last year. And even after that I look at the future innovation's Amazon
is planning: 1-Hr delivery via drone, dev friendly alexa tasks from anywhere.
And I can't think of anyone that can currently be termed a "true" competitor.
And I am clearly not the only one to notice. $AMZN stock up %50 since Feb ;)

------
rajeshamara
Only if Google / facebook stops inventing. Yahoo made a mistake of stagnation.
Microsoft made a mistake of stagnation from 2000 to 2009 (Balmer period).
Motorola made a mistake of stagnation. Apple is again making a mistake of
stagnation. As long as companies not sitting on their arses and let the
competition overtake them they will be fine.

Also you can live without FB but cannot live without google. You can remain
days not visiting FB but everyday you will search atleast one time.

------
mathattack
I think No for both cases. Default monopolies can go out of favor very
quickly, and new technologies can ramp up very quickly.

On Facebook: Remember that Google got the whole world to sign up for Google
Plus with their circles. They didn't do anything with it, but it was a clear
sign that you can sign up a good portion of the internet.

On Google owning search, if Apple goes downmarket in the phone market, they
could crowd Google out of search on the phone. Or there may be some other new
paradigm - searching out of apps, with a non-Google choice winning. And if the
search algorithm is MUCH better, it could win. Bing doesn't need to be 5%
better - it would need to be 500% better.

------
f_allwein
Yes. When I worked at Google, people were very aware that their market
position is not a given and could change any time - eg as people are far less
locked in to Google than they used to be to Microsoft in the 1990s. Eric
Schmidt used to point to an article from the late 1990s saying "the search
wars are over - Yahoo won"...

It wouldn't be easy obviously, but it is conceivable that someone comes up
with something that is significantly better than Google/ FB, causing people to
switch.

------
bwackwat
Basically, I believe it will be much harder for a competitor to reach the same
_capital_ as Google or Facebook.

Google and Facebook have massive networks, specialized storage strategies,
proprietary protocols and hardware, and not to forget the actual data they
have acquired. Lots of hard-to-acquire capital.

On the other hand, I do believe that both products could be better.
Competitors could have better products, but not for a long time more capital.

~~~
rms_returns
I think Google and Facebook will face the same enemy that Microsoft faced back
in the 1990s - the nameless and faceless, Open Source!

Maybe, if FOSS can build a self-syncing co-operating network spanning multiple
nodes across the globe, they can solve the infrastructure/data-storage problem
(we already have two precedents here, namely Bitcoin and Bittorrent networks).

Finally, if FOSS can also convince a good proportion of masses to crowdsource
their efforts, they would have solved the data acquisition problem too!

~~~
dandelion_lover
>self-syncing co-operating network spanning multiple nodes across the globe

It's already there, see
[http://yacy.net/en/index.html](http://yacy.net/en/index.html).

~~~
alkchr
The idea is great and I wish them good luck. But, unfortunately, it isn't
usable yet IMO.

------
atsaloli
Every empire has its rise and fall. "To every thing there is a season ... A
time to be born, and a time to die"

------
wallace_f
Do you think a FB competitor that offered really nice encryption and privacy
features would be successful?

I'm imagining an app that let's you choose where to store data, let's you
store your data encrypted and offers message encryption, and of course allows
you to sign up anonymously and permanently delete data.

I hate Facebook but I recognize it serves a useful function - I only use it
because everyone else does.

~~~
seanwilson
> Do you think a FB competitor that offered really nice encryption and privacy
> features would be successful?

> ...

> I hate Facebook but I recognize it serves a useful function - I only use it
> because everyone else does.

I think privacy is a very niche interest for most users. It's very hard for
non-technical users to understand and therefore appreciate online privacy in
my opinion. Understanding what the padlock in the browser location bar is
difficult enough for most people.

------
mavenxinc
A year ago, I think you could have included Apple in this list and they have
begun their spiral.

------
the4dpatrick
Google and Facebook are not immortal beings infallible of mistakes. These two
entities are companies comprised of people. At whatever level you look at
inside these two organisations, you’ll see people making decisions. Whenever
there are people involved there are bound to be some inefficiencies and
mistakes made on the way. These inefficiencies and mistakes can be masked
however because of the size of the organisation and the actual impact of a
single decision made. Nonetheless a series of compounding “mistakes” could
lead to these companies being open to other competitors.

A strength of these two companies lies in the amount of talented individuals
in these organisations. Google and Facebook both have a reputation to hire the
best and brightest. If this is the case, then we can assume they’d have the
raw ability to make right decisions. (debatable point) Given enough time and
resources these people could do almost anything. This can be illustrated by
the number of moonshots being attempted at Google.

Another point of strength of these large companies is the ability to
diversify. Diversification comes in handy when you’re in an ever changing
world like we are in. Diversification comes in the form of external
investments into potentially game changing industries and technologies (AR,
BioTech, etc). Alternatively, change could come from within the organisations,
albeit a little harder and riskier,

These are a few of the strengths of large companies like Google and Facebook.
Despite these strengths new opportunities and new competitors will still
arise. Google is a search engine, but it has moved into email and other
markets. Google had existed before Facebook, and Google had more resources
than Facebook when it got started. Why didn’t Google takeover social
networking instead?

The OP posed the question about if Google will always be the default search
engine it has acted as for the last two decades. In my opinion, this can
change. With the advent of Amazon’s Echo and Siri, more and more searches are
being conducted via these platforms. Both of these platforms use the Bing
search engine. [1][2] If Bing did a better job [3], then it’s conceivable that
more marketshare can be had by Bing. As human computer interface progresses,
the act of visiting Google.com will become antiquated. This leads to
opportunities for other search engines to gain adoption more or less
transparently.

Facebook is a social network we access via our web browser and mobile device.
If VR becomes what is promised and more widely adopted, then social networking
as a category will become redefined. Facebook is at an advantage because of
the Oculus acquisition, but the VR space is still so young; There are no real
experts in VR.

TLDR; A series of “mistakes" made by these people comprised organisations
could lead to true competitors. Strengths, like talented people and
diversification, could counteract any risk to competitors. New platforms like
Echo, Siri, and Cortana abstracts the use of the Bing Search Engine. VR could
redefine social networking which opens more opportunities.

[1] [https://www.quora.com/Can-I-change-Siris-search-
engine](https://www.quora.com/Can-I-change-Siris-search-engine) [2]
[https://www.reddit.com/r/amazon/comments/2lsg9n/amazon_echo_...](https://www.reddit.com/r/amazon/comments/2lsg9n/amazon_echo_what_search_engine/)
[3] [http://thenextweb.com/gadgets/2015/07/08/alexa-y-u-no-
answer...](http://thenextweb.com/gadgets/2015/07/08/alexa-y-u-no-answer/#gref)

