Google Inc.
Industry Two—Internet Companies
CASE
12
Google Inc. (2010): The Future of the Internet Search Engine
Patricia A. Ryan
Google began with a mission: to create the ultimate search engine to help users tame the unruly and exponentially growing repository of information that is the Internet.
And most would agree that when the word “Google” became a verb, that mission was largely accomplished.1
IT HAD BEEN NEARLY SIX YEARS SINCE GOOGLE’S ATTENTION-grabbing initial public offering and, despite overall stock market weakness, Google remained strong. Although the stock moved with the market in general, the company returned significantly higher returns to its shareholders than did the S&P 500 (Exhibit 1). Founders Sergey Brin and Larry Page had created a huge empire in which they now faced challenges of continued growth and innovation.
These challenges would carry them through the second decade of the new millennium.
Background2
Google was founded in a garage in 1998 by Larry Page and Sergey Brin, two Stanford computer science graduate students, based on ideas generated in 1995. The name Google was chosen as a play on googol, a mathematical term for the number one followed by one hundred zeros.
It is thought the term was appealing to the founders as it related to their mission to organize an exponentially growing web. Founded on $100,000 from Sun Microsystems, Brin and Page were on their way to creating an Internet engine giant. Google immediately gained the attention of the Internet sector for being a better search engine than its competitors, including Yahoo!
This case was prepared by Professor Patricia A. Ryan of Colorado State University with the research assistance of
Ryan A. Neff. Copyright ©2010 by Patricia A. Ryan. The copyright holder is solely responsible for the case content. This case was edited for Strategic Management and Business Policy, 13th Edition. Reprinted by permission only for the 13th edition of Strategic Management and Business Policy (including
CASE
12
Google Inc. (2010): The Future of the Internet Search Engine
Patricia A. Ryan
Google began with a mission: to create the ultimate search engine to help users tame the unruly and exponentially growing repository of information that is the Internet.
And most would agree that when the word “Google” became a verb, that mission was largely accomplished.1
IT HAD BEEN NEARLY SIX YEARS SINCE GOOGLE’S ATTENTION-grabbing initial public offering and, despite overall stock market weakness, Google remained strong. Although the stock moved with the market in general, the company returned significantly higher returns to its shareholders than did the S&P 500 (Exhibit 1). Founders Sergey Brin and Larry Page had created a huge empire in which they now faced challenges of continued growth and innovation.
These challenges would carry them through the second decade of the new millennium.
Background2
Google was founded in a garage in 1998 by Larry Page and Sergey Brin, two Stanford computer science graduate students, based on ideas generated in 1995. The name Google was chosen as a play on googol, a mathematical term for the number one followed by one hundred zeros.
It is thought the term was appealing to the founders as it related to their mission to organize an exponentially growing web. Founded on $100,000 from Sun Microsystems, Brin and Page were on their way to creating an Internet engine giant. Google immediately gained the attention of the Internet sector for being a better search engine than its competitors, including Yahoo!
This case was prepared by Professor Patricia A. Ryan of Colorado State University with the research assistance of
Ryan A. Neff. Copyright ©2010 by Patricia A. Ryan. The copyright holder is solely responsible for the case content. This case was edited for Strategic Management and Business Policy, 13th Edition. Reprinted by permission only for the 13th edition of Strategic Management and Business Policy (including
References: Companies Have Jumped Through China’s Hoops for Years,” USA Today (January 25, 2010), pp Tricia Bisoux, “First Adopters,” BizEd (November/December, 2010), pp .com/printstory.php?pid 20382 (September 24, 2010). article_id 48584 (February 26, 2006). Bruce Einhorn, “Google and China: A Win for Liberty—and Strategy,” Bloomberg BusinessWeek (January 25, 2010), (November 8, 2010). “Frequently Asked Questions—Investor Relations—Google,” http://investor.google.com/corporate/faq.html (November 18, 2010). Steven Goldberg, “Tech Titans Are Cheap,” Kiplinger Personal Finance (September 28, 2010). Google 10-K form for the year ended December 31, 2009, filed with the SEC. Google 10-Q form for the third quarter ended on September 30, 2010, filed with the SEC. (November 8, 2010). “Google Grabs Personal Info Off of Wi-Fi Networks,” http:// finance.yahoo.com/news/Google-grabs-personal-info-apf2162289993.html (November 8, 2010). .html (November 8, 2010). (February 12, 2006). “Cars Drive Themselves: Google Is Testing ArtificialIntelligence Software in Cars in California. St. Petersburg Times (October 10, 2010), p Much of this section was developed from http://www.google .com/corporate/milestones.html (November 30, 2010). http://www.google.com/corporate.tenthings.html (October 15, 2010). Much of this information is from Google 10-K, 2009, filed with the SEC. Google Form 10-K, 2009, filed with the SEC. This paragraph was paraphrased from Google’s Form 19-K, 2009, filed with the SEC. Computing,” Bloomberg Business Week (January 25, 2010), pp Buy or Avoid?” Kiplinger Personal Finance http://www .kiplinger.com/printstory.php?pid 20382 (September 24, 2010). Google Form 10-K, 2009, filed with the SEC. Brad Stone and Douglas MacMillan, “Groupon’s $6 Billion Snub,” Bloomberg Business Week (December 13–19, 2010), p 12. “A Century of Executive Excess,” Bloomberg Business Week (December 13–19, 2010), p