Try as it might, Google hasn't seen much success in the social realm: Wave totally bit it, Buzz has had lukewarm reception, and we're still not sure whether or not the Internet giant's rumored social network will amount to anything more than a pipe dream. While most hopefuls are campaigning for a massive turnaround in 2011, Piper Jaffray analyst Gene Munster says Google is on the verge of giving up.
If You Can't Beat 'Em, You Can't Beat 'Em
"The reality is they can't recreate the social graph that's basically won by Facebook," said Munster in a video interview with Bloomberg News. The statement is hard to argue and echoes many a sentiment from experts over the last year -- especially since Wave's demise -- but does that have to mean total annihilation?
"I think Munster might have a bit of a tunnel vision when it comes to Social," wrote Seth Weintraub. One wouldn't have much trouble arguing that YouTube is one of the bigger social sites on the net. Also Google Buzz has been integrated into Google Reader RSS pretty nicely..."
Google has also busied itself with the integration of existing social elements and other personalization-y perks, such as the addition of Twitter results to its search pages and customization options within Google News for tweaking feeds, but it seems something that was touched on most recently by the sFund investors is still in the way: Google isn't inherently social.
"I think over the next few years we're really going to see the [companies] that get built from the ground up to be social have a very fundamental advantage over the ones that are just slapping it on on top, checking a box and think that they can move on from there," said Facebook's own Mark Zuckerberg at the announcement event.
Munster does make a point to say that Google will likely still try and tie into the social grid as well as enhance its own search products for continued growth, but that the reality is "Facebook has shown that finding information is more social-based and less machine-based, and as people trust friends more than machines, you’re going to see ad dollars shifting from Google over to Facebook."
Does Size Matter?
Facebook is currently worth roughly US$ 150 billion less than Google, but its growth rate is much higher: 100 percent per year compared to Big G's 22 percent. This of course has much to do with Facebook currently being much smaller than Google in general, but the quickness with which the gap between the two companies is closing is making many Googlers a bit nervous. As Munster put it, "It's David versus Goliath, but David is extremely motivated..."
"As it looks at its future, Google needs to realise it has a user-experience problem and its simplicity - the elegant search box - isn't enough, especially as it starts to compete with rivals whose entire existence revolves around easy consumer experiences," said Om Malik of GigaOM.
Here's Munster's full statement:
Should Google really worry? Let us know what you think in the comments below.