One of the oldest war strategies in the book is to divide and conquer. Essentially, it means to spread an enemy’s resources thin by separating its power, and forcing them to fight a battle on several fronts, rather than just one. Think of France during Napoleon’s reign. Bonaparte used the strategy himself as a tactical tool, spreading his enemies thin, and dividing their power to gain strategic superiority.
There are similar parallels in the business world. While nothing close to Bonaparte’s difficulties, thankfully, there are concentrations of power and capital that have effectively allowed some giant corporations to do basically anything that they choose. Case in point, just take a look at Google. The company began as a small search engine, started by a couple of graduate students in a garage. Today, Google may just be the single most powerful corporate entity in the world.
Google has grown well beyond merely selling search advertising results to work its way into many other industries. The company is building cars, developing wearable technology, and any number of other projects that have yet to even see the light of day.
In short, Google is diversifying its business, and it has the resources to do it. But by entering different industries, Google is also making new enemies and rivals. For example, Google and Chevrolet had little to do with one another, in terms of direct competition, up until recently. Now that Google is prepping its own autonomous car, Chevrolet is seeing Google in a different light — as a potential rival.
That’s not necessarily a bad thing. Again, Google has the resources to explore new opportunities. The question that remains is just how many projects the company can take on before it’s all a bit too much. Is Google spreading itself too thin? And if one way to slay a giant is to separate its power, is Google playing into its enemies’ hands?
For instance, it’s safe to say that Google’s bread and butter is the search advertising business. That is a segment in which its main rivals are Microsoft (Bing), Yahoo, and a handful of smaller competitors. Google still dominates the industry in a large way, encompassing more than 75% of the industry’s market share, but that number has been on the decline recently. That may be indicative of companies like Microsoft and Yahoo putting more resources into their search business.
Or, it could mean that Google’s attention has been directed elsewhere, and its resources directed at fighting new rivals.
Just take a quick look at the company’s current slate of products and services. From social networks to online shopping, Google is taking on the biggest companies in the world on a number of different platforms. That includes Apple, Facebook, Microsoft, Yahoo, and Amazon, just for starters. Then there are all the other projects Google is invested in, which include things like artificial intelligence, transportation, high-speed internet service, and a slew of others. That means that while taking on the world’s largest and most powerful technology companies, Google is also picking fights with the likes of Comcast, Verizon, Time Warner Cable, General Motors, Ford, and many others.
Clearly, Google is not afraid of testing the waters of nearly any market out there, and making a rival out of the oldest and most entrenched incumbents.
By doing so, Google redirects resources — both capital and talent — to areas in which it has yet to prove it can compete. The fact that the company has decided to take on so many rivals, all at one time, may be a bit worrisome for stakeholders. Like we previously mentioned, Google is showing signs of floundering, and there’s a good chance that many of its gambles won’t pay off, like many have in the past.
On one hand, Google is still doing just fine. It’s worth hundreds of billions, and there’s little reason to believe that it is in any serious trouble. But Google does seem to be making things easier for its competitors by taking on everyone and everything it can. By creating multiple divisions in its resources, is Google sewing the seeds of its own destruction? For now, it doesn’t appear so. But if history is any indicator, Google’s rivals are waiting patiently for the armor to crack.
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