Experts say the company’s new Wi-Fi and cellular service network is all about its fundamental core mission – gathering user data.
Google, known for its search engine, its mobile Android operating system and numerous popular products such as Google Maps, has been pushing the boundaries of research and innovation with projects such as its self-driven cars and advanced robotics.
The internet giant is now competing against the likes of wireless carriers like Verizon and AT&T in the data and cellular market. This raises a few questions. While the latest Google move may look daunting and confusing, Project Fi is helping Google with its ultimate core and long-term strategy – getting more information and behavioral data about its users. This translates into ad sales and revenue for Google.
“I’m not sure they’re trying to become a big-time wireless player,” said Brian Haven, an analyst with IDC (International Data Corporation). “But by becoming a wireless service, it allows Google to gain a lot more data from new end points with users. Data is what drives them. Regardless of whether or not they can generate a nice revenue stream, the data will still feed into the other things they do.”
Google’s newest endeavor. Project Fi
Google announced recently that it’s working with Sprint and T-Mobile to come out with its own wireless network, named Project Fi.
The company is offering potential customers to sign up online for an invite system, similar to what it did with Gmail, when first introduced. It also added that Google Fi will only be available for Google’s stock android device – the Nexus 6 at the very beginning.
The announcement garnered a lot of attention for a few reasons.
- It’s a new Google venture which usually piques plenty of interest along with it.
- The pricing plans are coming in at a low cost. $20 a month for talk, text, Wi-Fi tethering and international coverage in over a 120 countries. Cellular data will cost $10/ gigabyte.
Independent Industry analyst Jeff Kagan says it is a strange move for Google. “To tell you the truth I don’t get it yet,” Kagan said. “I was expecting more. I was expecting a big, innovative new-thinking approach that could transform the industry, but that’s not what we got. Maybe it will eventually grow into that, but what we got was a disappointment…. Will this work? To me, this is a big question mark.”
Google, which makes most of its money and search and advertising is known to invest time, research and resources in various new ideas and technologies. A ready example would be Google Glass, which Google has been working on very publicly. Still, Google’s core business model remains.
“Google’s strategic imperative is always to drive usage of Google services and applications,” said Bill Menezes, an analyst with Gartner. “Their core business is never going to be cellular service provider. Their core mission is to get more people to click on Google ads, to use Google Docs, to watch YouTube videos. This new service plays in perfectly with that.”
“Google has already been getting that information from people out there using mobile data, but the more people using mobile data, they more info they’re getting,” added Menezes. “It’s like you’ve been farming 40 acres and you’re doubling that to 80. With more data, they can target advertising and better sell you products and all the other things Google does to make money.”