Mark Cuban’s Simple Plan to Unseat Google Won’t Work
Posted by Bob Warfield on May 15, 2008
Mark Cuban has a plan. He wonders what it would cost to deny Google access to the best search results. What if you pay the top 5 results for the 25K most common searches NOT to be accessible by Google? What if you paid the top 1000 sites $500K apiece not to be on Google? It’s only $1B, which is doable for the likes of a Yahoo/Microsoft.
Here’s my problem with this. Aren’t some of those most popular sites so popular that $500K means nothing to them? Is it worth $500K to the world’s Global 2000 companies, for example, not to be seen in Google searches? No, of course not. What about the 1000 most important trendy and best selling brands? I can’t see that $500K being attractive enough. Would Nike or Apple stay off Google for $500K? Would George Clooney, Madonna, or Britney Spears accept $500K to go dark on Google? Maybe, but I’d think you need to go much further down the celebrity food chain before they’d opt out for that money.
People say that Google is the Internet’s front door. What is it worth to your business to force people to go to the back door instead of the front door they’re used to? How do you get enough businesses to switch to the back door when there is no history to show them it will be okay?
BTW, lest we forget, Google can monetize traffic better than anyone else to date. Translation? They can afford to pay these site owners more than Yahoo/Microsoft or whomever else Cuban has in mind to do this deal.
Google has the luxury of forcing all the risk onto the would be implementors of this plan, and then jumping in at the last minute to take it away from them if the plan works.
I am reminded of conditions in the oil industry during my youth in Texas. There is a ton of oil in Texas to this day. But for a time, it was shut down and manipulated until the oil patch practically turned into a ghost town. How? Well, a good Texas oil well produces about 100 barrels a day. To get that out of one, you’ve got to pay to drill it, the well may be fairly deep, you have to pay for a pump on top, and you probably pay for a fair amount of “reservoir engineering” to help the oil to flow freely. In Saudi Arabia, by contrast, an average well is shallow and flows perhaps 1000 barrels a day. No pumps needed, just a valve on top.
What do you do if you become annoyed at competition and you are the Saudis? You just open the valves, drop the oil prices, and wait until rigs have all rusted and the oil operators have gone out of business. Then you crank the prices back up again. What’s it today? Well over $100 a barrel. The oil business is back to gangbusters in Texas, and they’re even drilling new wells like crazy. Not sure this time if it’ll work to crank open the valves. There’s a lot more demand today than there was then.
Raganwald gives us a vintage 1977 speech by Carter on the energy shortage posted just as I finished this post. This would be the point just before those valves were opened and the oil industry in Texas shut down. Today there is not so much talk of a shortage (we should’ve run out by Carter’s estimation and usage is far in excess of what was predicted then). Rather it is an issue of too much consumption leading to Global Warming.