Blog Post

Google as a power company


If you are like us, you follow the SEO industry fairly closely. This, of course, means following Google. With a healthy market share of between 65 and 85% of the Internet searches (depending on what report you trust), Google is the clear market leader. Some may argue a monopolistic position, in fact.

Earlier this week we saw Google announce their new phone, the Nexus One. It looks like a great device and runs on Google's own open source platform called Android. They are leaving both the hardware manufacturing and phone network to other companies such T-mobile, Verizon Wireless and HTC. But they want the data. With their superior operating system and handhold computer features, they will get it.

But today, one of the more odd Google stories I've read in a while. Google has applied to trade electricity on a large scale. They want to enter the power market as a major buyer. And given the amount of electricity they use for their server networks, this probably makes economic sense. When you think of the staggering number of data centers they must operate to be able to parse the data from over 45,000,000 websites - each containing potentially thousands of individual pages - and return relevant search results to an end-user in under a second, you start to get the idea that they would be well-served to build their own power plans. That makes me wonder... Are they thinking of a green energy play in the future? This would be a logical first step. But that's a serious stretch from their currently business model.

It also feels a little bit like the airlines. They purchase so much jet fuel that they practically become oil traders. In fact, I recall last year that SW Airlines made a profit only because of their savvy futures trading during turbulent times in the oil market. I wonder if Google is going the same way with this move?

Or perhaps they are reaching out into other markets and plan to diversify their revenue streams beyond Internet searches sometime soon. Who knows. But stay tuned.