Posted in Big Thoughts Social Computing

Google Plus defines an era of disruption at a moment’s notice

August 4, 2011 - 9:00 am

Whether or not you like Google+ or have yet to try it, its introduction continues the important role that a battle of ideas has in shaking-up and bringing new value to the marketplace. In the best outcome, robust competition in any business domain should have at least one benefactor: you, the consumer.

Google+ raises the stakes in the social computing space. With so many people and organizations already invested in other social platforms, Google+ is a manageable gamble with the potential for considerable consequence. Yet for the leading social media incumbents the risk may be existential. Fending off this kind of threat will likely require drastic and prompt measures.

When the entrant yields this much power in an existing market and elicits as a response the potential for rapid innovation, this is what I am calling the “G+ effect.”

The G+ effect is best defined by the introduction of Google+, but it’s not unique to Google; it is unique to our times.

What is the G+ effect?

The disruptive impact of introducing a new product or service is obviously nothing novel. What is new and profound is that the viral and light-speed distribution of digital information and capability across our connected planet can threaten existing businesses at a moment’s notice. The entrant doesn’t even have to be game-changing, but the outcome can be. The influence and reach of the provider can result in disproportional results from just incremental innovation (even whether or not the product succeeds). It is the innovator’s dilemma in overdrive.

The torrent of punditry that accompanies these introductions is notable alone. We are also seeing a significant intensification in rampant speculation prior to a release that can unsettle a market.

Of course, being incremental initially doesn’t rule out disruptive later. For example, in the case of Google+, what it becomes in the months ahead and what it may enable could certainly be game-changing. It’s far too soon to tell.

It would be easy to conclude that the G+ effect is a destructive phenomenon. Sure, there is something to be said for the uncertainty it can sow, and honestly it is impossible to know quite where it will take us. There is no doubt that existing business players will be challenged in unprecedented ways and some customers may be riled by the constant volatility. I also have to believe that at some point every one of us has a capped quotient for fickleness. But I argue that, at least in the short-term, a dynamic battle of ideas will remain a positive force.

At its core, the G+ effect is an economic phenomenon. Clearly there is an important technical component, but introducing a new product or service that can have rapid and far reaching impact, first and foremost shifts existing market behavior — even if temporary in nature. In some instances, for publicly listed companies, the business introducing the technology may experience a bump in stock value (as we have seen with Google+) and its competitors may see theirs experience downward pressure.

The G+ effect and Google+

Despite only a limited early release, in just a few weeks Google+ has garnered over 20 million participants from across the world. If every one of them had only written the words “Hello World” in the status box, that itself would have been a notable event. Instead, billions of words were added with their attendant photos and videos. Pundits are already claiming the imminent demise of its competition; products that worked hard over several years to earn each subscriber, friend, and follower. (In my view, any notion of the competition’s obsolescence is far too premature).

With Facebook taking a significant lead in social networking, it has emerged to occupy a monopolistic position. A sudden injection of viable competition is a great catalyst for innovation. It is one thing for customers to complain about the limits of Facebook Groups and privacy and quite another for Facebook to respond to the potential competitive advantage that Circles in Google+ create.

Let me be clear, this isn’t a battle just between Google and Facebook — although it could be argued that it will be the early nexus of the action — no, the impact may be felt across the communication, collaboration, and sharing space.

The only good monopoly is the board game

In a topical and recent case study, for much of its young history commissions have sought to stop Microsoft from garnering a monopoly position. Microsoft’s huge footprint in the operating system market enabled it to exploit that position. Look at the innovation of Internet browsers and you have the tell-tale signs of stifled innovation as a result of market domination (remember the first browser war?). It was only when there was a viable alternative, mostly in the form of Firefox and most recently with Chrome and Safari, that we have seen an uptick in browser innovation. (Credit also goes to the various communities that work hard for standards ratification).

Had competition been more rigorous in the early days of the browser, would we be further along with web-based capabilities today?

Currently we see dynamic and healthy competition in the domain of smartphones. But it is also a fragile battle. Now largely dominated by Android and iPhone — solutions created by organizations with extremely healthy balance sheets — innovation is alive and kicking. But should one stumble, a dominant player could emerge and we could see innovation atrophy. Sure, it is speculative and there are plenty of participants trying their darnedest to play catch-up. In fact, with the average American replacing his cellphone every 21 months (source: Recon Analytics), this industry is a prime candidate for the G+ effect.

The G+ effect and the future

What the G+ effect might mean for businesses and consumers over the long-term has yet to be determined. Fortunately we can rely on the marketplace to help sort out what happens next.

At least in the short-term, as an IT leader I encourage rigorous innovation and competition as it helps to keep product and service costs low and accelerates the introduction of desired functions. I also want this innovation to restrict the ability for large corporations to create a closed web or to reduce the very freedoms that make it so empowering.

But with this level of innovation, I’m also concerned by the change costs both in dollars and those that manifest in user fatigue. It could also exacerbate the problems associated with playing catch-up.

For sure, the G+ effect has the capacity to elicit considerable change in the way many organizations operate and compete. Getting a head start on figuring it out might enable many to pursue the emerging opportunities.


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