About two years ago, I was talking to my neighbour about investing. He was telling me about his latest plan to invest in Yellow Pages, a highly recommended, by his broker, investment. The stock was trading at around $10 at the time.
To me, the investment didn’t make sense. I can’t remember the last time I looked at a yellow pages. The fact that I always seem to lose that huge book, and the rise of the internet kinda said this was the dinosaur of the reference book. I didn’t give the company much thought until it was brought up again a few months back by another friend who wondered if Yellow Pages was a good investment now that it had fallen below 15 cents… Personally, I still don’t like it for the same reason. Why go to YellowPages.com when I’ve got Google?
Living in Canada, and being a hockey fan, RIM used to be the darling of the mobile phone industry…until the iPhone. The first time I tried the iPhone, I knew Blackberry had to change, but they didn’t, and the stock is on the decline.
Powerhouse companies can disappear. Remember Enron, Worldcom, etc? When there is a disruptive technology, if the company doesn’t adapt, it will wither (think IBM, Microsoft) if not die.
This leads me to something I’ve read a lot about lately in the various “What to invest in for 2012” type articles. One company that seems to be making a lot of recommended lists is Google. Yes I think Google, the high flying, dominant search engine and internet darling is a bad bet…for one simple reason, Siri.
For those of you who don’t know, Siri is the Apple iPhone 4S’s “personal assistant”. You just ask your phone a question, say something you used to Google, and it provides you with the answer…without using Google.
If you think the dominant search engine has nothing to fear from a new way of searching, maybe you should look what Google did to search engines like Altavista and Excite.
Siri is all the rage, with over 1 million iPhone 4S’s sold already. What happens when Apple enables it on the older technology like iPads, iPods, and older iPhones? What about the future Apple TVs?
Ad revenues from searches is Google’s Cash Cow, and they don’t have many other profitable ventures, what will happen when they lose the search? If they don’t find some way to counter Siri, I think their days are numbered, because you know Microsoft and others will try to copy Siri, further hurting Googles chances of surviving.
Lesson: Don’t bet on dinosaur companies to lead you into the future.
You are mistaken, Siri uses google for general search, just as it uses Yelp for questions re retail locations.
google mobile search has had voice search way before siri and is starting to provide it onPC’s via Chrome.
Siri (actually Nuance ) and other voice based systems will increase the number of google searches not decrease them
because they feed into google for general searching.
Let me know your thoughts.
Yes, Siri may increase Google searches, but Google doesn’t make money off a general search, it makes money off of advertising that it posts around your search and click-throughs after a search. With Siri, Apple eliminates this source of revenue from Google, significantly lowering the income from Google.
As I said, the popularity of Siri will have other systems follow, increasing things like Nuance’s popularity (Apple is rarely the first to develop a technology, but they do have a habit of making it mainstream). With all the systems using Google’s infrastructure, but eliminating a significant revenue stream, how does Google profit?
I’m not saying Google will die this year, but I do see a major problem for them. Think Kodak when digital cameras came in, they stuck with film until it was too late for them to change. I don’t see Google doing anything to replace this last revenue right now, if they don’t react, they may be in bigger trouble.
The internet as a whole is in a lot of trouble if advertising is effectively circumvented (as was the case with newspapers).
I see Siri as a bit of a niche search tool. Serious searches for serious purchases are not very likely to be made on a 4 inch screen. I wouldn’t want to spend hours scrolling and scrolling through pages on a tiny touch screen. And serious searches for serious purchases are the valuable searches. It may hurt somewhat local searches for restaurants and the like, but are those really Google’s bread and butter?
Right now, it’s only on a 4 inch screen…what happens when that changes? Apple only has to enable it. What is Google’s response? I’m looking a few years down the road, when we ask computers the search questions like on Star Trek. It is coming, maybe not from Apple and Siri, but I think we’ll see it soon.