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Google Key Factor of Success

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1. What were the key factors behind Google's early success?

The key reasons for Google's success is a belief that good ideas can, and should, come from anywhere. Google's early success is based on several key factors.

1. Technology. Along with its innovative approach to page ranking, Google is a purpose-built hardware company, building all its own servers from components it buys directly for their manufacturers.

2. Business Model Innovation. By perfecting the nature of targeted ads, Google not only has created a highly effective revenue generator, it has produced what it hopes to be a better experience for its users. It is Google's goal to make their targeted ads at least as relevant and useful to users as the search results themselves.

3. User Experience. Google focus on its users experience by optimizing its service for end user first and for revenue second. Google firmly believe that the better the user experience, the more easily money will follow.

4. Bottom up Approach: Nurturing great ideas from all levels of the company, not just the top.

5. Creativity: Demand creativity by giving employees "free thinking time" to develop pet projects, no matter how far from the company's central vision.

6. Managing Innovation. Google management adopted unconventional management style. Engineers are encouraged to work in a small team to improve productivity. Management is always available to employees so that their idea can be heard.

2. Do you expect the search business to become more concentrated (i.e. dominated by fewer firms)? Is search a winner-take-all business?

The search business has become concentrated in recent years, as we see from exhibit xxx most of the internet users are loyal to a search engine, they do not switch between different engines such as yahoo/Google/msn to seek different results. As search engine are refined overtime, it may be advantageous for companies as Microsoft/AOL to use Google search capabilities rather than try to invest in refining its own search engine.

Google has won both the online search and advertising markets. They hold a considerable technological lead, both with algorithms as well as their astonishing web-scale computing platform. Beyond this, however, network effects around their industry position and brand will



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