Attacking Google where the money is

Google is undisputed leader of search. It’s useless for me to describe how Google changed the world about it, but let’s talk about everything else Google is doing such as documents, e-mail and mobile OS’s, of course. All this is funded by ads, while they have some other incomes such as former-Postini customers and other Google applications customers, ads are what fund anything Google do.

A few other companies tried to beat them starting from scratch such as cuil, but I would say that so far none of them has been able to be a serious competitor. Now what if the money on the ads was taken away from Google? If Google had to focus on ads more, would they be able to continue spinning off new applications and services? Would they still be able to create great apps and give them away as open-source just to kill the competition (think of Google docs and Android)? (OT: doesn’t this remind you of Microsoft and Netscape and other products they gave away embedded for free to kill the competition?)

It seems to me like recently the competition and innovation in ads have grown a lot. In mobile, Google is a follower and while they do have HUGE power and have been able to sign great contracts with operators and big players, the leader in mobile seems to be AdMob (even though I don’t have exact numbers handy). Now, also in web ads there is more and more competition. I was watching a video today about Dapper that is bringing some innovation with a product called Mashup ads. I am not a publisher, so I can hardly tell if this is a killer for Google, but surely it is something new and interesting.