Google: Serve First, Monetize Later

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Guy Kawasaki says in business, before you think about money, you should think about “making meaning.” You should want to change the world and make it a better. I don’t know anyone who does this better than Google.

The Google founders continue to blow me away with their awesome moves: doubling the size of their index to 8 billion pages, scanning millions of pages in libraries, free desktop search engine, free photo editing and sharing tools, free blogging tools, free news and news alerts, free SMS query engine. I can’t wait to see what they do with Keyhole.

This USA Today article about Google shows how they create value first and then seek to monetize it later.

That is the philosophy that drives me. I’m in good company. I think in the long run, it’s the winning philosophy.

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2 Responses

  1. Eliot W. Jacobsen

    In certain on-line services where the network effect produces critical mass that can raise barriers to entry and produce increasing returns I can support a serve first, monetize later model so long as the company has a plan for monetization. Free access to the service will attract more users and will jump start the network effect, enabling the company to compete more effectively later. It’s a bit of a race. First one to critical mass wins.

    In Google’s case, every thing they do reinforces their core position of “ubiquitous ad supported search”. They’re not serving new users or advertisers (costly to do), but serving the same users and advertisers with more services. Pretty smart. But worth $50 Billion (today’s market cap with a 222x P/E)? I’m still thinking about that.

    Check out today’s Forbes piece: http://www.forbes.com/technology/feeds/general/2004/12/20/generalusatoday_2004_12_20_eng-usatoday_money_eng-usatoday_money_021627_3261014783683235756.html?partner=yahoo&referrer=

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