Free Essay

Google's Motivation to Bid Into the Wireless Marketplace Through the Use of the 700mhz Spectrum Auction.

In: Computers and Technology

Submitted By rshableski
Words 741
Pages 3
Why did Google make this move?
Google’s motivation to bid into the wireless marketplace through the use of the 700MHz Spectrum Auction was the opportunity to develop a 50 state network. This new product development would allow Google to become a cellular network operator. This market includes firms such as AT&T and Verizon, Google would not only compete with these firms but would also have opportunity to network with other entities to develop some innovative new products.
What do they hope to accomplish?
The prospect of entering into the wireless market offers Google many potential growth and development practices as well as competencies. There are also many risks associated with this strategy, including the cost of building and maintaining a billion dollar network. One particular goal that may have been in mind with this decision is the growth of Google’s vast wireless software portfolio that includes Gmail, Maps, Docs, Calendar Sync and various other applications that can be downloaded to many phones. There may have been other reasons Google chose to take interest into the wireless market such as the ownership of Youtube and its developments in a new website and java beta application that allows people to view tens of millions of videos via cell phone.

How does Google’s support for open access fit into Google’s plans?
Google supporting Open Access really makes this a popular decision. Many people are rooting for Google to bid on the 700MHz spectrum for reasons that it will allow for competitive pricing of many cellular internet features. If Google is successful, broadcast companies will have much more flexibility in creating business models that use spectrum that used to belong to them in the first place. Open access provides that following flexibility:
• Open your office documents – View your documents, spreadsheets, PDF files and more.
• View your photos – You can view a slideshow and import photos to and from your mobile device
• Listen to your music – All of the music that you’ve got on your account is now instantly available.
• Watch your videos – All videos that you’ve stored on your account are instantly available.

It looks like Google wants to get into wireless, yet, wireless is not one of Google’s core competencies. What should Google do about this?
Google has a history of branching out into many diverse businesses, such as WiFi and online bill pay. Oftentimes over the years there doesn’t seem to be a method to the business strategy madness for Google. They have now entered into the wireless world which is not their core competency. Google has spent $3.9 billion in the last eight quarters on capital expenditures. It could easily spend some $8 billion on spectrum and network construction. That’s a big step away from its core competency and you can bet that incredible market cap isn’t going to stick around forever. What goes up must come down, especially as other online search companies close in on the company.
Apply as many TCOs as you can to Google’s migration to Digital.
TCO A- Google’s dynamics of technological innovation of migration to digital
The reason that Google has struggled to apply this core competency to offline media, i.e. magazines, newspapers, and not TV, is that these media lack both the scaled of activity and the natural feedback loop that enables Google to create efficiencies by harnessing these market dynamics
TCO C- Google’s core competencies
Leveraging the “Long Tail”
Go to almost any website today and you see a section for “Ads by Google”. A person can earn revenue by enabling Google to place contextually targeted ads on their website. This is called leveraging the “long-tail” of the internet

Control Data Sources
Google Maps is another example of a Web 2.0 core competency: the ability to control data sources that get better as people use them.

Rich Internet Applications
Google Maps, along with Gmail and Google’s word processing, spreadsheet and calendaring applications are great examples of Rich Internet Applications, another core competency of Web 2.0

Harness the Collective Intelligence
Another core competency of a Web 2.0 company is the ability to “harness the collective intelligence”. One way Google does this is through its pagerank search algorythyms. Google determines the true value of a link on the web, through its link structure. It’s not just about a page being there and people clicking on it, it’s about who links to this page and how those sites are.

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