Facebook V Google

Facebook takes on Google

2010 has seen Facebook challenge Google’s supremacy on the Internet with its social network approach to how people live, work, play and search online, and proof that ‘Social’ is the new ‘search’.

Google delivers its search results based on complex algorithms that take into account a user’s Web history by tracking IP addresses and placing cookies on your computer, Facebook has a much higher level of personalisation based on users “likes” and the recommendations of web pages and the interaction with Facebook friends. Mark Zuckerberg, who co-founded Facebook in his Harvard University dorm room six years ago amidst controversy is now worth an estimated 6.9 billion dollars, refers to his model as the “social graph”.

“I think what we’ve found is that when you can use products with your friends and your family and the people you care about they tend to be more engaging”, Zuckerberg said in an interview with the television show ’60 Minutes’.

The social graph is incredibly broad, picking up on Zuckerberg’s favorite phrase. “It includes not only what you do and what you like but people you know and what they like and the companies you interact with”. There is nothing new about the concept of referring friend; recommending a restaurant for example is very powerful stuff, but when we are able to share our likes and recommendations online in ‘real-time’ with a network of people as fast as telling one person, the concept takes on a whole new meaning, and businesses’s are looking for ways to cash in on the way we are sharing our daily life.

Facebook has effectively created a parallel Internet network built around the interactions of its more than 500 million members; and is the second Internet, maybe more valuable than the first because more and more of us are interconnected on it.

Social networking media is an increasingly important part of how we interact with other people and it’s a growing part of every businesses budget.

Facebook and other social networking sites including dating sites are where people are going to spend increasing amounts of time.

According to online tracking firm comScore, Google receives more unique monthly visitors than Facebook but visitors to Facebook spend more time at the site than they do on Google products.

Since early 2010, Facebook has been rolling out a stream of features which put it head to head with Google; an @facebook.com email service which competes with Google’s Gmail and “Facebook Questions,” a search engine of sorts which lets Facebook members ask questions and get answers from other members, which is like a search returning recommendations.

As you would expect Facebook has been attracting the kind of people Google are also after; and Google employees as well, forcing California based Google to recently raise salaries by 10 percent across the board, in an attempt to retain its brain pool.

There is no doubt that Facebook and Google have become competitive in some areas, and interestingly it’s not that Facebook has grown at Google’s expense who still showed growth in 2010. Google is not going away in fact, Google should be benefiting from the emergence of social media. What Facebook is doing is driving people to spend more time online and when you’re spending more time online, you end up doing more searches, and this is where Google’s strength is.

Where the real competition lies is for the online advertising dollar in their respective display areas. Facebook has a lot of people who buy display advertising. Google wants to sell more display advertising.

Mark Zuckerberg, who was named 2010 Time magazine person of the year, acknowledged that there are areas where the companies compete, but then, there are all these areas where they just don’t compete at all.

Facebook’s growth is not necessarily a bad thing for Google, which has been coming under increased scrutiny from anti-trust authorities in both the United States and Europe.

Some of it plays very well for Google, who are now able to say they have strong competition out there.

It’s not necessarily to Google’s disadvantage that Facebook is growing so fast at the present, but I don’t see Google allowing the business dollars go else ware for long.