Monday, 28 March 2011

Google loosing its Midas touch?

Google will have to add another failure to its list – the company has just announced withdrawal of Real Estate listing service from Google Maps. It is partly the result of discontinuation of Google Base API but the primary cause quoted in the announcement is “low usage”. I appears that “economic reality” prevailed over somehow philanthropic ambitions of Google to provide “free services for all” – at stake was a huge revenue flow from advertising from subscription based real estate portals – and that is the main game for Google.

Real estate listings on Google Maps and via Google Base API service were available for US, Australia, New Zealand, the UK and Japan. Many anticipated far reaching changes in real estate online listing market as the result of Google’s entry, including the author of this blog, but we were all proven wrong. No hard feelings on my part as it opens up new opportunities since Google left a big niche ready to be explored but it begs a question, what went wrong for Google? I believe that the main cause was the service was just an add-on layer to Google Map and, to my best knowledge, listings were never promoted in online search. Google lacked clear vision for the service and was never committed to push it in any big way, not to upset its largest advertising clients. Otherwise who knows what might have happened…

Google is indeed struggling with creating thematic content for its main map platform so it is no surprise the company decided in the end to leave real estate listings to third party developers. Is Google starting to loose its Midas touch? Initially it looked that they cannot make any wrong move – search engine dominance, online advertising platform dominance, online video dominance… But more recent explorations and experimentations seem not to deliver the expected results.

News and Fairfax, and their associated real estate portals and, stood their grounds and did not want to participate in Google’s experiments. REA Group ( share price more than doubled since Google entered the market in July 2009 and despite growing dissatisfaction with the service from real estate agents. Fairfax shares are only slightly up. If one had “blinked”, the outcome could have been totally different… So, for now, back to status quo - it will have to be someone else, not Google, who will shake the things up for them. Telstra was not so lucky and in the end it opted for tighter cooperation with Google (now not only providing listings for Google's local search from its Yellow Pages but also map data for Google Map).

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