Google has major headaches going into 2015 caused by Apple, Facebook

“Google shares were falling in early trading Friday after Bank of America Merrill Lynch downgraded the Internet giant to ‘neutral,’ citing several factors including worries about the search business and increasing competition from Apple and Facebook,” Chris Ciaccia writes for TheStreet. “Analyst Justin Post lowered his rating and cut his price target to $580 from $600 on grounds that the company’s major revenue driver, its search business, may be nearing maturity. He pointed out that Google hasn’t had a major product launch this year, an event which might have offset slowing revenue growth.”

“Not only are there major concerns about its core business maturing, but Apple’s exceptionally strong product cycle this year, led by the iPhone 6 and new MacBooks, as well as concerns about its search deal with Apple’s Safari browser, also cause for concern,” Ciaccia writes. “‘Apple is having a strong phone product cycle, which could benefit search activity, but is a potential headwind to Android,’ Post noted. ‘Also, according to press reports, Apple and Google’s search agreement may expire in 1H’15, and we see risk that Apple switches default search providers given Android phone competition. While we wouldn’t expect an International change, Mozilla recently switched to Yahoo search in the US (mostly PC), so a US change would not be unprecedented.'”

“Safari had over 45% of the mobile browser market in the U.S., and losing that would be an enormous blow for Google,” Ciaccia writes. “Apple CEO Timothy D. Cook recently noted that Apple’s only real competition is Google, so losing the Safari deal to be the default search engine is perhaps the biggest headline risk for the company going into 2015.”

Read more in the full article here.

MacDailyNews Take:

Google’s going to rue the day they got greedy by deciding to try to work against Apple instead of with them.MacDailyNews, March 9, 2010

26 Comments

  1. What does this guy mean by: “Google hasn’t had a major product launch this year.” What about Google glasses? How about the Google driverless car? Google has one enormous money-maker after another lined up well in the future. Plus, it is only a matter of time before those Google floating barges start bringing in the bucks. This is a company firing on all cylinders.

    Oh sorry, I thought I was writing an article for The Onion.

    1. Don’t forget Google Loon Cellular Network Balloons for all you people who can’t get a decent internet connection. That’s supposed to change the world as much as their other futuristic projects like the Google Johnny Cab and Khan N. Singh Genomics Project. These projects are giving Google that huge P/E 28 premium. Where’s Apple’s world-changing projects. None. Apple is only a smartphone company and that’s all it will ever be. Doomed.

      /s

      Wall Street is possibly starting to realize that a search engine is not going to carry that company if a serious search competitor comes along. If Apple decided to put DuckDuckGo on all its devices by default, Google investors would run for the hills. Just the mention of Yahoo or Bing getting default position is making Google shareholders sweat.

      And forget about Android OS. That’s the OS for the poor and there won’t be much ad click revenue coming from BRIC nations.

  2. Mdn”Google chose to work against apple….”

    Way more than that MDN ..
    They had their Eric Schidt spy at apple board.
    They stole apple technology and blatantly copied it ..

    The thermonuclear war is not done till Google pays and feels the pain !

    1. They were both towed to the Cayman Islands. Eric Schmidt used them to secretly transport several hundred billion dollars of investment capital so from his perspective it was the most profitable move he ever made.

  3. I can see Google failing over the next few years with chrome and android, but I can’t see them failing in search. Google Search is people’s default search, so they will change the default search back them self or just navigate to google.com themselves.

    1. I can see Google not necessarily failing in search, but definitely their dominant position in search is very much at risk.

      Google Search may be the default, but that’s because of the deals it has in place, which it appears to be losing. Many people who have that default swapped out with another default may not even notice. Those that do may prefer the new one or may not bother to switch.

      Not to mention the snowball effect of losing a bit of traffic to a competitor who then experiences an increase in revenue which results in more marketing and development.

      1. I disagree. I think Google search has become a part of people’s everyday web habits that they’d notice if their default search all of a sudden changed and they’d be asking their tech savvy children/grandchildren to change it back.

        1. I think *search* has become a part of people’s lives, although even that is changing a bit, meaning there are more and more people where the Internet is Facebook, Amazon, Netflix, eBay, etc…

          It’s like when Apple switched from Google Maps. Most people noticed a difference, but most people didn’t understand the difference, and most people didn’t re-install Google Maps.

          People going to the browser search box and entering a search term are going to get results… that’s what they’ve been conditioned to do. It’s an above-average user that would understand the results are different, and then a subset of that that would want them back, and a subset of that who would actually change it (or have it changed).

        2. People really do not care who gives them an answer, as long as the answer is correct, or correct enough. Apple is very aggressively making the “who” inconsequential. Google knows full well if Apple changes the default the same thing that happened with maps will happen with their search. Really I think Apple will use this as a bargaining chip for better terms and keep Google around, but on a much tighter leash.

    2. When people wake up and realize their android phone is covered with parasites and viruses; bleeding confidential data out to the ‘net AND that their personal email is being parsed and sold to the highest bidder or for free to the Feds AND ALSO that whatever they do on the web, is digested and fed back to them in synchronized marketing attacks, THEN… People will be sick of being used like a piñata and stop playing their game. I for one don’t want to share my privacy for someone’s gain.

    3. It will be hard for Google to lose leadership in search. There are still people using AOL internet access. Their will probably still be people using AOL a century from now.

    1. I second that. It’s a fine search engine with no tracking. I don’t know about Google’s magic search algorithms, but DDG works pretty damn well if you ask me.

  4. Lately Google search seems better at supply ads matching my search terms than at finding the information I want.

    When you use Siri for search you don’t see which engine you are using so it would be easy to substitute another search engine.

    For Safari, Apple could make something else the default. For the minority who really care they would be allowed to set the default to Google.

  5. I switched to DDG as soon as it was possible on iOS. Their results seem good to me and the no tracking is golden. How does DDG make their money, does anyone here know that?

    1. Every once in a while, some of their results have one very, very obvious add related to your search on the top of the page. Just one. And it is very obvious an add.

      I always click on it if only to send them a little something. That’s how they make there money so please give them a hand (or click)

      1. After I posted I did some research. They monetize via advertising, like other search engines do. I remember in the nineties when Google was lean and uncluttered like DDG is today. It was so superior to the other players then in that space. I switched immediately to Google search and a whole world opened up. It’s too bad they had to go all evil with the tracking and IP theft.

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