Business strategy - Google broke its Glasses to save its future

Where are the Google Glass? Google Glass was supposed to be a must-have for consumers everywhere, setting the standard for wearable technology for years to come. From real-time navigation, video capabilities, extreme sport assistant, to foreign language translations, it had a plethora of interesting features that were meant to seamlessly integrate into daily life. Combine this with a wearable technology market ripe for the picking with an estimated $30 Billion up for grabs by 2018, and you have a recipe for success. Google was hoping to capitalize on its first-movers advantage, projecting as many as 21 million units in annual sales by 2018 which translates to roughly $10 Billion in annual revenue. But none of that happened. The Google Glass as we know it is officially dead, killed by Google in 2015.
Despite the concerns regarding battery life, software bugs, and lack of viable use cases, Google Glass wasn’t killed because of its technology. The real reason relies on google business strategy. The glasses business model was maybe unsure but Google killed the Google Glass because it was negatively impacting its major source of revenue: advertising. Mobile and PC search ads market share for google is estimated at approximately 67% of the firm’s value based on their Q1 2015 financials.
For a company driven substantially by advertising, maintaining a positive image is crucial.
Google Glass raised privacy concerns. Certain bars, casinos, movie theaters, and other establishments actually banned the use of Google Glass due to the violation of the privacy. The fact that the users, labeled “Glassholes”, had the ability to record videos and audio and utilize face recognition applications without the knowledge or consent of others made the general public uncomfortable. It caused people to revolt against Google labeling the company with ‘big brother’ type figure, eliminating any sense of privacy. The bad publicity would have impact the brand and its products such as gmail and maps. Therefor Google decided to cut the cord and kill Google Glass before it could negatively impact their image further and potentially lead to decreased advertising revenue.
What Google didn’t know at the time, is that by killing the consumer edition of Google Glass they actually uncovered an even greater opportunity.
Although it was unplanned, Google executed a perfect market strategy to drive the demand for Google Glass.

Originally, Google used a ‘push’ model by trying to open a new market with a device filled with cool features, but not fulfilling any immediate known need onto consumers. Once the sales of Google Glass were discontinued, many companies were able to identify challenges where Google Glass could potentially be the perfect solution.
This newfound demand created a ‘pull’ model where organizations were eager to utilize Google Glass’s technology to create a solution specific to them.
Healthcare, first responders, and manufacturing companies especially have found real use-cases for the Google Glass. Thus Google Glass Enterprise Edition was born. Google has been working closely with its ‘Glass for Work’ partners who have been authorized by Google to build enterprise solutions for Google Glass. The new model features longer battery life as well as a more durable frame in response to some of the concerns of the previous version. Many believe that Google Glass Enterprise Edition could be Google’s unifier, finally integrating all of Google’s offerings.
The current pressure increased on the job market seems to indicate a move closer than expected. Google is growing the Aura project team while Apple seems building its own glass team. Although it is still too early to tell how successful Google Glass Enterprise Edition will be, as of now it seems like the original death of Google Glass may have actually saved it in the end.

Think encore !

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Patricia Howell said…

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Thank you Patricia for your nice comment.



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