So, how did Google get a market share of less than 1% in 1999 to almost 80% today? What is so special about Google and how did it become dominant on stage? In this article, the third in my series of search history, I look at the role of luck, time and mistakes of competitors in the growth of Google. I also appreciate the unique technology and vision behind the Google algorithm.
Dot com shake-out
You may be surprised to hear how I moaned about the dot-com style of 1999-2000. After all, for many of us it was an exciting time. However, for the early search engines, it was, in fact, a deadly chime! New money entering the market was huge, but investors wanted to see profits. Search engines were clearly part of the future, but where is their income? How can you earn free results - especially free results for very expensive computer infrastructures? This impatience is hard after the crash of dot-com in March 2000.
Yahoo! it seemed to be the only company with any sustainable “clean internet game” (from advertising, which was well funded by the dot-com dollar at the time). At the same time, AOL pursued a moderately successful approach to traffic in the style of “fenced garden” (that is, where 70% of the requests on the site resulted in content in AOL properties). The argument at that time was that it was easy for people to “access” other sites (the main goal of the modern search engine) was to lose the opportunity to sell them anything from your own website and content partners.
Altavista, acquired with DEC Compaq in 1999, was reorganized for huge money as a competitor portal for Yahoo! Similarly, Excite (now owned by @home broadband provider) tried to become an AOL clone. Lycos, already the largest “clean portal” in the spring of 1999, teamed up with the largest Spanish ISP, Terra Networks (and then ran into the ground).
Disney / ABC and NBC have already invested heavily in Infoseek and Snap with respect, but quickly began to realize that the income they can get from increasingly portal-like services will never provide the short-term payback that shareholders are usually looking for. Steve Bornstein, chairman of the Walt Disney Internet Group, said in a press release, “The Internet environment continues to change and change, and there, before our strategies also have to change.” 400 employees on the Go network were fired and the buyer bought for the Infoseek engine.
In December 2000, the amazing report StatMarket.com showed that only 6.86% of all referral traffic to websites came from search engines (compared to 47.01% from direct navigation or bookmarks and 46.13% from Internet links ). Since then, the quality of this study has been questioned because it was not based on server logs, but on Hitwise stat global statistics (code that was posted only by many webmasters on the home page of their site). However, these data came at a time when the collective loss of confidence in search and portal technologies. The collapse of the dot-com in March 2000 left investors with a serious hangover.
Is it any wonder that so many search properties disappeared altogether (or closed their internal scanning capabilities) in 2001? With the closure of the “Northern Light” (at least to the public) in January 2002, the beating of Dot-Com was essentially closed or mortally wounded by WebCrawler, Magellan, Excite, Infoseek, Go Network, Snap and Lycos. It also seriously damaged Altavista, which had to fight without any real investment in search capabilities before they acquired Yahoo! in 2003.
Appearance of paid search
If the rush to convert all search engines into portals was (at least at that time) an erroneous strategic thought, then the bad time also played a part in the demise of so many early rivals.
Quiet and almost unnoticeable during mania was a relatively small search player called go-to.com, renamed Overture in 2001. While paid listings were tried before, Overture (with a market share of 2.76% in January 1999) was the first company to make it successful, and some advertisers pay up to $ 1 per click by 1998/9. Go-to.com, in fact, only paid results! Personally, I never liked or used the site for this reason. Nevertheless, they stubbornly continued their strategy, deciding to find a sustainable income model and are confident that the problem-oriented search engines of that time did not have enough to offer a growing army of Internet users who are looking to shop and # 39; until they fell!
History proved that Overture was right (to persist with paid advertising), although initially it was limited. Perhaps if the dot-com investigators only waited a little longer (or started a little later), the value of the sponsored results would become clear. In any case, the big boys went into oblivion of the portal, while the tortoise Overture (and the model that it spawned) extremely won the race.
All the best businesses start in garages
It really is. The 12x18 foot garage, in which David Packard and William Hewlett launched Hewlett-Packard in 1939, is considered by many to be the birthplace of Silicon Valley. A short drive away is the garage of Los Altos Steve Jobs. parents, where was born Apple Computer Inc. Google Inc., just traced its first days in the garage - it's in Menlo Park, California, where the newly created Google Inc. spent its first five months as a good business in late 1998.
However, the real story of Google began more than two years ago, as a research project (nicknamed "BackRub") of two Stanford Doctors of Science. students: born in Michigan Larry Page and Russian Sergey Brin. A simple obsession that took both was a link between sites on an exponentially growing network. In his initial research of the thesis, Paget suggested that any link from one site to another looks like an academic quote and description (or anchor text) attached to this link as a summary. If it were possible to identify the sites most cited for any given annotated subject, it would be possible to establish a hierarchical order of significance for any given subject domain.
What Paige specifically charmed was what he saw as a fundamental weakness in Tim Berners-Lee's original design for the Internet; sometimes it was easy to see what a site was attached to, but it is very difficult (if not impossible) to see the links of sites back. Backrub bought in order to catalog all the links on the Internet and, through this, determine which sites have the most "power" in general and in any given topic. The page insists that at this stage he was not going to create a search engine. However, intellectual curiosity moved forward into creating a new kind of searcher based on the link ranking system (now called PageRank after its creation), which was the first of them.
It was at that moment that Sergey Brin was involved in the project. At that time. The company estimates that the size of the website is about 10 million documents, and the number of links should be 100 million. Altavista impressed everyone by managing to index all these documents on one large computer. However, indexing both documents and references was, to put it mildly, a big hairy problem; This is exactly the problem that Brin had.
In fact, the problem was much more complicated than what might have been implemented at that time. At the moment, the network is growing at an exponential rate, and the computational resources required for this task actually exceed the modest resources of the student project. This brings me to the role that the lady played in shaping Google.
At the end of 1996, the BackRub searcher consumed almost half of Stanford’s network bandwidth, and in some cases reduced Internet access at Stanford. The country and Brin had to ask and borrow the capacity and constantly flee from space and lines of credit. While both were hardworking, they were not completely confident in their business careers. As Page puts it now, he will either be a professor or run a company that matters. There would be nothing between them.
So, believe it or not, in the period from 1996 to 7, all three of the then market leaders approached two students with the idea of licensing a new type of search engine. In August 2004, at the SEM San Jose “Search for Memories” session, the group included Doug Resting (formerly Senior Architect, Excite), Steve Kirsch (formerly founder of Infoseek) and Louis Monnier (former AltaVista Technical Director). Together they recalled the early years of search engines, and everyone acknowledged, one by one, that they sent the founders of Google packaging. Steve Kirsch was the brightest; "Go a pound of sand, I told them." Doug Resting said: “I was not impressed with their demo at all,” and Louis Mornier stated: “I did not have the authority to sign the check anyway.”
What if Larry Page and Sergey Brin were a little better in PowerPoint? What if Louis has his checkbook? Perhaps this book was titled "Getting to the Top of Altavista", and Digital may still have been in business, continuing to make machines that power the Internet. The lady led, of course, played a role in the process!
However, since their attempts to evade fate, Stanford graduates did not find a suitable partner. Some are born great, others attain greatness, and some impose great greatness on them. Perhaps Larry and Sergey fall into this rare last category. By the end of 1998, Backrub (renamed Google in September 1997) grew rapidly and served more than 10,000 daily queries. The guys met through common contact with Andy Bechtolsheim, an active investor at an early stage. After a short demonstration, Andy literally put a check for $ 100,000 into his own hands. Google inc. was born, and Bryn and Paige celebrated their journey to the Burger King.
The guys literally lacked a bank account or a legal entity called Google to make a deposit. So, as soon as the burgers write overcooked, they created Google Inc. and rented a garage from a friend. Five months later, the initial investment roll was just under $ 1 million, and by June 1999 the next round (of venture capital financing) exceeded $ 25 million. If it was a fantasy, you would say that it was a fairy tale ... but sometimes truth is alien than fiction (especially in the strange world of technology).
From back room to boardroom in just 5 years
So what does google mean? Bryn and Paige close the name, brainstorming with other students, as a play for the word "Gogol", which means number one, followed by 100 zeros. Google uses the term to reflect the company's mission; "To organize a huge, seemingly endless amount of information available on the Internet." As an interesting footnote, the word “Gogol” itself is traced to the work of the American mathematician Edward Kasner in the 1940s. His descendants briefly reviewed a lawsuit with Google in 2004 for using the name without royalty. Only in America!
Unlike its competitors, Google had a clear vision, a great time and all the luck. Despite the fact that the big boys played in their portable portals, Google ruthlessly focused on creating the world's largest index, organically taking its place in its powers and providing paid listings along with emulation of the successful Overture model. When the network turned into a huge haystack, Google helped you find a needle. These factors, above all, laid the foundation for the later domination of Google.
The company was also quite economical and managed to make the initial venture capital funding very long (at a time when other dotcom millionaires spent money as if it were fashion). In those early years, licensing search results on other Internet sites and ports became the main source of income. Key points included using Google Yahoo! in 2000, to force their search results and later AOL's decision to do the same. Suddenly there was only one serious player in the city!
After the important business winnings in 2000 (and the launch of Google AdWords and the Google Toolbar the same year), the search engine processed more than 100 million queries a year. By the fourth quarter of 2001, the company was making a profit — an incredible achievement, considering that Amazon (founded five years before Google in 1994) immediately became the first quarterly profit.
Between July 2002 and June 2003, global search engine referrals nearly doubled (from 7.18% to 13.46%) and have grown rapidly since then. Most small business sites now receive over 85% of their new visitors from search engines, with Google typically sending about 70% of them. In the UK, search engines have overtaken adult sites (October 2006) as the busiest category on the Internet.
It is inevitable that Google will eventually enter the market, and this initial public offering took place in August 2004, creating a company worth $ 23 billion. More importantly, the flotation attracted about $ 1.67 billion, which Google can use to develop new products and purchases. He also made instant paper millionaires of many Google employees.
Perhaps the biggest irony in the search history is that AltaVista and the others were not too erroneous in their obsession with portals. They were right at the wrong time! Today’s concern is no different from the current situation with Google and other people who want to create stickiness in their offer. Suffice it to say that these billions of IPOs at the bank were helpful in acquiring YouTube and DoubleClick in 2006-7. This ends three series.
