The rivalry between the two tech giants, Facebook and Google, just got nastier after Facebook was caught red-handed trying to launch a smear campaign against Google. The bone of contention has become a subject of controversy in itself because Facebook is not exactly innocent of the crime it is accusing Google of: collecting and sharing user data without consent.
Facebook even hired a top-notch PR firm to maneuver the bad publicity stunt against the search giant. The pot-calling-the-kettle-black attempt of Facebook backfired after the PR firm had offered to write a bad piece about Google then subsequently squealed to the media.
Analysts, however, surmise that Facebook is using the so-called privacy concerns as a mere smokescreen and that the real reason why the two behemoths are clashing is because…
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- both wants to get a lion’s share of online advertising, and
- Facebook isn’t too pleased that Google is developing its social networking service called the Social Circle and using data gathered by Facebook.
Google’s Social Circle allows users with Gmail accounts to keep track of their friends’ (and friends of their friends) information and activities on the web. The tool is designed to supplement the search results with data culled from Facebook and other web circles. Google has been trying to infiltrate Facebook’s domination in the social networking arena but its earlier efforts flopped.
As the king of social networking with 600 million members, Facebook enjoys a good slice of online advertising pie because of its uncanny ability to get people to share who their friends are and what these people like. Google dominates search results-related advertising, but when it comes to targeted advertising, Facebook has proven that it’s a formidable force to reckon with especially with good backing from Microsoft.
Another trend that Google needs to watch out for is that Facebook has also become a master at user engagement: An average FB user is estimated to spend over seven hours on the site per month and the numbers continue to go up; whereas, users only spend about two hours on Google and the numbers are dwindling.
Late last year, Facebook also started prompting users to make FB their homepage or their portal to the web, a move which no doubt gave Google more reason to hate Facebook. Adding insult to injury is the fact that Facebook has successfully convinced Google’s key employees to switch loyalties. The brain drain of Google’s engineers and executives reportedly prompted the company to raise the employees’ paycheck by 10 percent.
Facebook’s business is doing so well that it’s likely to exceed earlier forecasts of $2 billion in earnings for 2011. According to the Wall Street Journal, at the rate Facebook is growing, its earnings for this year could easily reach $10 billion.
Still, analysts have doubts that Facebook has enough machinery and business savvy to successfully kick Google to the curb. Management style and experience-wise, Facebook is still a fledgling company compared to Google. In fact, a Facebook-Google face-off is more likely to hurt the former than the latter in the long run. If Facebook is not careful and if Google decide to take the rivalry several more notches higher and hit Facebook where it hurts the most, the search giant is likely to win the battle hands down.
