Signal, Services, SegmentsUnderstanding Google’s Expanding Content Ecosystem

John Blossom, Shore Communications Inc.17 September 2014

About Shore

● Content Marketing Strategists○ For publishing and content technology

products & services in enterprise and media markets

● We provide:○ Market research, intelligence & analysis○ Marketing strategy review and advice○ Go-to-market content and services

● Recognized:○ Twice-awarded EContent 100 Company ○ SIIA CODiE – Best Media Blog

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Google’s World

PerformancePlatformsPoliciesProjects

Quantifying Google

Benchmarks of Google performance

Google is the #1 global brand

● If there is a future worth having, people trust Google to deliver it

Google is the #1 global search engine

● Rapid growth in developing nations will accelerate global market share

Google is the #1 mobile platform

● Rapid growth in developing nations will accelerate global market share

Google is the #1 computing platform

● Billions experience the Web mobile-first

Google is the #1 Web platform

● Google Chrome dominant on PCs, #3 in mobile and rising

Google is the #1 digital ad platform

● Maintaining a strong hold on revenue from context

Source: Statista

Invested in the long run for success

Invested in the long run for success

Strong, but Stalled in the Short Run

Treading water as revenue streams shift slowly to new and broader sources and investors punish R&D, capex spends

Strong, but Stalled in the Short Run

● Treading water as revenue streams shift slowly to new and broader sources

What the top-line numbers tell us

● “Understand the world and make it more usable” works!● Google innovates rapidly, but being pushed into more and

larger acquisitions and R&D to sustain and grow markets● Mobile and Web revenue growth is restricted

○ Marketing solutions aren’t helping small businesses to grow fast enough to generate significant new revenues

○ Over-centralized social media and mainstream media restricting growth of quality content destinations

○ The Signal Economy is real, but infrastructure and services are still very immature

○ Regulatory pushback in large/developed markets● Best hopes focused on constant redefinition of markets

Google vs. Competitors

● Apple: fading walled-garden position, Googlex-platform apps minimizedirect impact, a BMW in a Chevy world

● Microsoft: Huge investmentand restructuring to get backinto the game rapidly, strong brand growth and enterprise loyalty, but legacy and near-zero mobile share a huge challenge vs. Google

● Facebook: Stranglehold on mom, dad, small businesses and social marketers may loosen as Google attacks these, lack of sense-making for personal signals and Web content

● Amazon: Strengths are becoming weaknesses as Google’sdisjointed tools for business marketing & fulfillment mature

Google Platforms 2014

Highlights and trends

● Any device, any market● Signal-driven services● Openness that customers want● Fueling inter-platform services● Defines leading edge of

performance, innovation● Expanding premium content

offerings and mojo● Acquisitions and features pushing

into enterprise

The world according to Android

Android: products for all markets

Android: Not just for geeks and cheap

● Leading in specs and design○ Moto X rivals iPhone 6 for style and performance○ Nexus “X” (Fall launch) “spec killer”○ HTC One M8, HTC Nexus 9 Tablet (Fall)

● $100 Android One launched in India ● Flexible licensing strategy pays

○ Vendors mostly adopt Play Services○ Allowed to compete with own services○ “Pure” Android growing

■ Nexus/”Almost pure” models■ Google Play Editions■ “Silver”

Android drives signal services

● Google Now predictive and voice-driven services (some appear in Notifications)

Android & enterprises

● iOS 67% ent. share in Q214 vs. Android 32%● Samsung Knox MDM/EMM device management

integrated into base code● National security-cleared versions emerging● Acquisition of Divide for BYOD encryption and

work/personal contacts/content division● Google committed to fork of OpenSSL to address

Heartbleed exploits ● Google Drive Android apps provide more editing

Android Wear

● Extends Android phone apps functionality● Voice commands/notifications/gestures focus● “At a glance” functionality

+ health sensors● Motorola, LG,

Samsung, Asus, more● Predictive services● Easy-to-customise features● All-day battery life? (varies)● Compatible with all Android 4.4+ phones

Google Glass

● Full production availability for Explorer Edition● The only head-mounted full-function wearable -

but a niche market (new model expected)

Is Google Glass a “fail”?

● The last “escapedproduct” fromSergey Brin?

● Extension of Cr-48 dev’t concept

● More apps!● The bleeding

edge “Corvette” tested system/apps for Android Wear “Impala”

Android vs. iPhone

● iPhone 6 corners“iPhone but bigger”market

● Almost no featureinnovation, specsoften eclipsed by best Android devices

● Apple Pay debut is timed for 2015 rollout of smart bank cards in U.S., but Wallet does more

Android Wear vs. Apple Watch

● Full apps run on Watch● 3 style levels● Early 2015 availability● Trying to do too much?● Works only with iPhones● Unknown battery life● DATED concept for

wearables compared toAndroid Wear

● Margin-building focus

Android on the horizon

● Nexus X - “spec-killer” phone with 4K video● Nexus “9” - tablet w/optional keyboard● Android 5.0/”L” - enhanced battery life, ART

performance, Material design + multi-platform integration

● Android TV● Year-round new

products to buildmarket momentum

Android TV - multiplatorm, multiplay

● Cross-content video search and curation● Emphasis on gameplay via phones/tablets/jstick● Chromecast integration ● Upcoming voice-command casting/auto-casting

Android & Google Play services

● Near-equivalent content vs. competitors from audio, video publishers (can’t afford not to)

● Book publishers lag, but catching up slowly (Authors’ Guild suit impact diminished)

● Gamepublishers seex-platform &performanceopportunities

● Apps? #1

● The dominant global Web experience● 64-bit across all platforms (V37)● Integrating Android Apps● Chrome OS growth● Mobile sensor APIs● Pushing graphics standards● Google Now integration● Android file system access● Chrome for Meetings● Edit Office Docs in Drive

The world according to Chrome

● For all PCs, Android& Chrome OS

● Introduced in Version 37

● Enables better performance forgames, streaming, Native Client

● Enables Android apps embedding

Chrome 64-Bit = performance

● Limited release (4 apps)

● Uses Native Clientsecure container

● APIs still developing● Keyboard or

touchscreen use● Available for secure offline use● Chrome as the universal OS? MSFT worried.

Android Apps on Chrome

Chrome OS: More than niche

● Early “it’s a joke” false analysis in media obscured growth as platform was refined

● Launches again and again with more and more platform partners

● Hits “can’t miss” price points● Touchscreen models● High battery performance● Truly viable offline use● Secure, zero-virus use● Wide enterprise use

Chrome OS extends Android playbook

● Offline streaming support for video, audio● Multiple profile support● Google Now data cards integration,voice search● Android device downloads mountable via USB● Android-style on-screen touch keyboards● Android apps integration● More Web apps support (e.g., GoToMeeting)● More Web-based developers’ tools● New Chromebox models from ASUS, HP, Dell

Chrome OS grows features list

● The gyro-sensitive, game-quality Web

Chrome - more graphics and sensors

● Enterprise-grade streaming videoconferencing○ High-CPU Chromebox, remote, HD cam, speaker/mike○ Voice-activated and collaboration tools○ Compatible with many desktop/conference systems○ Starts at $999/room for hardware & service

Chromebox for Meetings

● Heavily discounted, stripped models● Trial versions of antivirus, Office ● Launching at higher-than-Chromebook prices● Back-to-school

sales pushedback some ofChrome OS’2013 gains

● Enterprise salesremain strong

Windows 8 fights Chrome OS

● Chrome’s pervasiveness on PCs may not translate to “ready for a Chromebook/box”

● Powerful, but Drive not yet a “killer” cloud app vs. Windows Office 365 as large enterprise standard

● Android integrationmakes enterprisesales much easier

● Mobile integrationemerging strength

● Web apps key

Will Chrome OS grow like Android?

Chromecast: Pervasive cord-cutter

● 4+ million $35 units sold since 24 July 2013 launch● Now sold in 12+ countries● About 500 Chromecast-enabled apps, Drive streams● Right now it’s a Roku/Chromecast race for streams● Producers moving towards streaming over cable

Nest: Sensing the home

● $3.2 billion buys a branding hedge, mostly● Aim is to have sensors and predictive services in

every room in the house● Product recalls, high pricing makes it a long-term bet

Google+: The quiet social giant

● #2 network? stats “iffy”● Underused by marketers● Interest-based audiences● Android drives global use● Backing off author tags● Ahead of Facebook in

automated content curation, video + photos services● Google’s unbundled G+ services aped by Facebook

Google Drive: x-platform, offline, APIs

●

Gmail: More active + friendly

● Automated sorting of emails● More integration of media players,

Google+ profiles and content● Better ad context● Integration of data from emails into

Google Now data cards (e.g., shipping notifications)

Google for Education: Classroom

● Automated sorting of emails● More integration of media players,

Google+ profiles and content● Better ad context● Integration of data from emails into

Google Now data cards (e.g., shipping notifications)

Google Views: Curating Maps photos

●

Google Fiber: Live and growing

● 1GB/s for $70/mo, 1.5MB free w/$300 install● Rollouts live in 3 cities, targeting 9 new metros● Already pressuring

cableco pricesdown

● FCC reviewingcompetitiveness ofISP marketplace

Google and Amazon: Unfriendly giants

● Order fulfillment initiatives○ Shopping Express

(limited trial rollout)○ Google[x] drone delivery

tests in Australia● Streamlining, enhancing

support for small merchants and cloud services● Fizzling Fire phone and TV box sales offset by

media pricing leverage and YouTube-only originals

Google Policy Trends

EU “Right to be forgotten”Net NeutralityPersonal identity and security

Google and EU “Right to be forgotten”

● Expert panel implemented guidelines relatively rapidly, 91.000 requests for 328.000 link removals

● Doesn’t address commercial databases that have already scraped data into “dark” subscription sources

● Censorshipeasilybypassed

Google and Net Neutrality

● U.S. Federal Communications received 1+ million comments on proposed Net Neutrality changes

● Google lobbied at first quietly for preserving “all-equal” access, then more prominently

● FCC likelyto expandneutralityprotections

Google and personal data

● Secure HTTP and dual-factor authentication key tools for managing personal data securely

● Apple iCloud breach triggered late and incomplete dual-factor options, may have stifled iPhone launch

● Prioritizing search resultsfor HTTPS-secured sites

● But average person stilldoesn’t understand thedifferences well...

Google Projects

Baseline Study health dataProject TangoAdvanced communications networksInteresting acquisitions

Google Baseline Study: small, huge

● Intense digital health data collection from 175 subjects● Using a variety of sensors

○ May include experimental contact lens for diabetes data

● Goal is to verify clinicalvalue of intense healthmonitoring

● May define key servicesand standards

Project Tango: 3D imaging for mobile

● Development prototype devices that scan spaces into 3D data models in realtime

● Applicable to mapping databases, motion-triggered apps and services, games, augmented reality

● New sensors promise3D data via one lens

● May surface in production productsas early as 2015

Project Ara: Production Prowess

● Modular mobile phone chassis

● 3D-printable components

● Tailored production for modules and standard chassis

● 2015 debut

Advanced Networks: web everywhere

● Titan Aerospace acquisition highlights interest in wide-area wireless/mobile network options

● Alpental acquisition to extend capabilities of gigabit Web connectivity more cost-effectively

● Short-term push in Africa for higher speedsin urban settings

● Rural strategies notrealistic so far

Machine Learning: DeepMind

● Stealth startup acquisition focused on artificial intelligence (machine learning)

● More revenues in marketing and services shifting towards predictive analytics (The Signal Economy)

● Quantum computingmay acceleratemachine learningcapabilities

Realtime Imaging: Skybox

● Evaluating satellite imagery for realtime “signals”● Applications to industry, traffic services, navigation

(is the parking lot full, etc.), marketing● Improved satellite resolution

powers detailed semanticimage analysis

● Applying lessons learned from other semantic imagingservices

Semantic music curation: Songza

● Context-driven content curation with a human touch● Music genres follow your work/life patterns● Some tech may be applied to Google Play Music

Summing it all up

The big pictureWhat it meansWhat we should do

Google’s big picture

● Agile giant with long term focus and shortterm product execution

● Still a geek culture, butlearning how to make ita brand “plus”

● Still does “moonshots”but the target range is now more isolated from mainstream and productized more carefully

What Google means for you

● Leverages open platformsto build valuable signal

● Redefines what’s interestingvia new definitions of content,markets and services

● Semantic context for datafrom anywhere is gold

● Investing in the “next 5 billion” aggressively

What to do next about Google

● The era of the walled garden isn’t dead, but it’s not where the growth is - spend on success in the open/mobile Web and being relevant in the midst of its signals and services (as if you shouldn’t have already)

● Be at the forefront of cross-platform standards and services - before Google defines them for you

● Come to terms with the mistakes that you made in combatting Google - and move on

For Follow-Up

PHONE(+01)203.293.8511

EMAILjblossom@shorecominc.com

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@jblossom google.com/+JohnBlossomPOST

John BlossomPresidentShore Communications Inc.80 Talcott Road

Guilford, CT 06437-5002 USA