Google Reader and other customer tragedies

(This was written weeks ago but not published until now.  I’m going to largely leave it as originally written, with an update at the end.)

I’m pretty upset about Google’s decision to drop support for Google Reader.  I think it is a mistake, and one that will come back to bite them (and actually already has).  I’ll get to more details of that a little later, but first let’s examine this on general principles.

All products and services must die at some point.  Maybe like Bonomo Turkish Taffy they will be reborn, but at some point a company has to decide it is no longer worth offering the product or service.  Often they hold on too long leading to failure of the organization itself.  Other times they have to look at the costs of continuing the business.  Those costs include actual costs, which may exceed the revenue received, and opportunity costs.  Opportunity costs include a tradeoff where putting $1 into business A produces $1.20 in return while putting it into business B produces $1.80.  So you stop investing in A and invest in B.  And that probably sends A into a death spiral.

There is also the problem of management attention.  The biggest complexity around management is not the number of people in your organization nor the size (in $) of the business, it is the number of different things you have to manage.  Be good at managing 100 pet stores and you can manage 1000 or 10000.  Be good at managing 100 pet stores and try to simultaneously manage 100 Women’s clothing stores and you will fail.  You just don’t have enough cycles to do both businesses justice.  Get into a conglomerate like GE and the complexity goes up a couple of orders of magnitude.  Those who can mange the diversity of businesses become CEOs (and get paid a lot for that ability).

But even great CEOs, let alone mediocre ones, hit their limit.  They reach the point where they can’t understand or manage the diversity of businesses.  They realize that this problem is not just theirs, but that the next level or two down in the management chain is struggling with the same problem.  They realize that they aren’t managing opportunity cost very well.  And they start to narrow the focus of the company.  And when they do that, products and services have to go.

Perhaps the most persistently popular posting on my blog is one discussing the demise of Microsoft Forefront.  Forefront TMG was a successful product, but it had to go for all the above reasons.  Forefront as a business had to go for all the above reasons.  It’s not that Microsoft couldn’t have successfully competed head-to-head in the security products business, it is that it was at the bottom when evaluated against management distraction and opportunity cost.  Most of the capabilities live on in the businesses that needed them, could justify the investment, and had the management cycles to mange them in the context of other products.  SPAM filtering in the context of an email server is not a distraction, it is a core capability.  Meanwhile what can be lost in all of this is the customer.

Once you have one customer you have a problem because you can’t discontinue a product or service without pissing off that customer.  It doesn’t matter if you have 1 or 1000 or 1 million, the reaction is going to be the same.  So TMG customers are pissed off.  When Microsoft discontinued Money large numbers of people were pissed off.  Customer’s don’t care that the customer base isn’t growing, or that in fact it is shrinking.  What they care about is that they are using the product or service, that they invested heavily in it, and that there is no wholly suitable replacement.

How upset customers will be is one of the factors you have to consider in deciding to kill off a product or service, because it can impact other product lines.  If you are in the Dishwasher and Jet Engine businesses and you decide to kill off your dishwasher line then it probably doesn’t have any impact on Jet Engine sales.  If you are the supplier of both computer servers and computer storage to large enterprises and you kill off your server business it may very well tank your storage business as well.

Besides outright killing business are there alternatives?  Sure, you can sell or spin-off the business.  It is questionable how much goodwill you retain as a result.   If you picked DEC Rdb over Oracle because you didn’t much care to do business with Oracle, but then DEC sold Rdb to Oracle, how happy with DEC were you?  If, as I’d agitated for, we had spun Rdb out from DEC as its own company would customers have been happier?  Now instead of dealing with a large well-resourced company they’d have been dealing with a small one with very limited support resources.  One that would probably have failed or been acquired by yet another company they didn’t want to do business with.  It’s lose vs. lose vs. lose.

I actually tried to sell Forefront TMG when it became clear it was no longer strategic.  The financials of the sale didn’t make enough sense, and my argument that it was the best thing for customers was somewhat debatable.  On the good side the pressure from my efforts lead to a modest increase in funding that allowed TMG to soldier on a few more years.  Did Microsoft re-think that “sell it” idea last year when they finally decided to end-of-life TMG?  Would customers be happier if TMG were sold to a small company that would give it a modest ongoing life?

Google was long accused of having a product strategy that consisted of throwing jello at the wall to see what would stick.  Of course it’s not binary.  There is no stick vs. no-stick.  Everything sticks, a little.  A couple of years ago they decided to get real about their product portfolio and start trimming things that hadn’t really stuck nor had a way forward.  As a manager and as an investor (though not in Google, fwiw) I applaud them for this.  It should, over time, make them a much stronger company.  But every time they drop one of their offerings they piss off customers.  So far it has been worth the tradeoff, but is killing off Google Reader going to cause grave bodily harm?

I used to manage RSS feeds using Microsoft’s My.live.com page, one of their own initial jello-throwing efforts around the creation of Windows Live.  Of course they never reconciled having both My.live.com and My.msn.com and eventually they killed My.live.com.  My.msn.com can actually function as an RSS reader, but while My.live.com could export your feeds as a OPML file my.msn.com couldn’t read a OPML file!  So I created a Google account and imported my feeds into Google Reader instead.  For years now that has meant I grab my first cup of coffee, sit down at the computer, and look at Google Reader.  Moreover, it has meant that whatever else I do through the day I’m always logged into my Google account.

I’ve used other Google services since creating the account so I could use Reader, but for me none are particularly sticky.  When Reader goes one thing is certain, I will no longer log in to my Google account except when absolutely necessary.  That isn’t a statement of protest, that is just a statement of reality.  Without Reader I have no reason to leave my browser logged in to Google.  It also leaves me reliant on just one other Google service, Google Voice.  Now the truth is that I use Google Voice for just one thing, to get speech-to-text versions of voicemail, and that means it isn’t a very sticky service (particularly since my mobile provider now offers speech-to-text, for a modest charge).  Meaning I could very easily end up relying on no Google services, and dropping my Google Account entirely.

Google Reader also happens to be something that is heavily used within the community of “influentials”.  So while other services that Google has dropped were met largely with a whimper, this one lead to an explosion of protest.  Adding fuel to the fire, Google had driven most competitors out of the market with Reader so there is a feeling that something nefarious is going on here.  Did Google pre-plan to monopolize the RSS Reader market so they could then kill it?  I highly doubt it.

Many have pointed out that RSS Feeds are somewhat of a dying breed, because people use Twitter, Facebook, and other social networks as an alternative.  I partially agree with that assessment though I personally have a problem with it.  I may want to follow a tech blogger’s occasional technology posting, but that doesn’t mean I want to see a couple of dozen of his tweets every day about everything from his political viewpoints (which I may or may not agree with) to what his cat had for breakfast, just so I know when he’s updated his blog.  And in fact multiply that by the 100 or so blogs I follow and the Twitter stream becomes so large that I can’t find the announcements of blog entries (or read the tweets of those I really want to follow).    So I see RSS Feeds retaining an important, if modest, niche.  At least until Twitter comes up with better filtering tools.

Hey Twitter, if you want someone to help you build an RSS Feed replacement into your service drop me a line.

From a business standpoint why should Google have kept Reader alive?  One reason really, that “Google Account” is super-valuable.  It is a means for getting someone to use other services.  Moreover, it is the ultimate means of performing tracking.  As long as I’m logged in to a Google Account while using Google services, including search, they can track my behavior.  And because it is first party none of the attempts to block that tracking apply.  TPLs?  They don’t apply to First Party cookies.  Safari and other browsers’ outright blocks on Third Party cookie?  No effect on First Party tracking.  Identities are important, and Google seems to have forgotten that.

Of course for heavy users of Google services none of this probably matters.  I doubt very many people who use Gmail as their primary email service are going to move to a competing provider.  But for the hundreds of millions of us who use Hotmail, Yahoo Mail, or an ISP’s mail and maintained a Google Account for use of various ancillary services the death of those services means we have no reason to maintain a relationship with Google.  And in the long run that will hurt them.  Not fatally of course, but potentially enough that it would have paid for them to keep services like Reader alive.

Products and services eventually have to die, as painful as it is for users.  If I weren’t a user of Google Reader I’d simply look at this and wonder if Google really did a good business analysis before making the choice.  And if they did, then I applaud them for making the hard decision, taking their lumps, and moving to put all their weight behind more strategic initiatives.  But since Google Reader was one of the most important services in my daily life, it’s hard to be that dispassionate about it.  I feel totally screwed over by Google.  It adds to my view that Google is not a good company to do business with.

So as I prepare to move on from Google Reader I’m also thinking about what would happen if I dropped my Google Account entirely.  What would be the impact both short-term and long-term.  That re-evaluation of the business relationship is exactly what happens any time any company decides to discontinue a product or service.  What Microsoft has done with Forefront made complete strategic sense.   But there are certainly many corporate customers who no longer view Microsoft as their provider of security software, even though Microsoft still offers most of what they need.  And there are no doubt a few who became wary of choosing non-security Microsoft products over leading third-party alternatives, though that caution will pass with time.  As will much of the impact of the negative reaction to the end of Google Reader.

(And now the update.)

I’ve moved on from Google Reader to Newsblur, which overall seems like a better cloud-based RSS Reader to begin with.  I did go with a paid account, both because that better met my needs and because Newsblur still isn’t taking new free accounts as they struggle to scale.  I’ve found one app on Windows Phone that supports Newsblur, but none on Windows 8.  So I’ll be using the web on the latter for now.  I’m sure in the coming weeks we’ll see multiple apps support Newsblur, as developers of apps that targeted Google Reader otherwise face the demise of their app.

Although I’d originally signed up for Google Voice as a potential second line or business telephone I barely used it that way.  Skype is a much better option for my needs.  So I was using Google Voice as a voicemail service, but I’ve switched that back to my carrier’s voicemail.  I also question the future of Google Voice as Google just isn’t acting as if it is a strategic offering.  And so rather than committing to it further I decided it was better to pull the plug before Google’s next “spring cleaning”.

I’d toyed with Google+, but long ago concluded that it really offered me nothing over my established social network on Facebook.  I can’t think of a single person I want to be “friends” with that is on Google+ but not Facebook (but most of my Facebook friends are not on Google+).  I could have split my personal networking on Facebook and business oriented networking on Google+, but I already do that with Twitter (which I use almost exclusively for technology networking).  So I stopped all use of Google+ many months ago.

I looked at my Gmail and discovered that other than a few distribution lists the only individuals contacting me there were the results of accidents (i.e., I’d mistakenly sent something out from that account and people had replied to it.).  And all of those individuals have my Hotmail address already, so it didn’t really matter.  I could drop the Gmail account with no real repercussions.

In one of those bizarre privacy violating situations I realized that Google had connected my account to a brother’s Picasa album.  For Google this shows the value of having someone logged in to their Google Account all the time.  For me it was disconcerting.  I don’t use Picasa myself.  Another area where people are (unknowingly?) sucked into the Google Account (lack of) privacy realm is YouTube.  I don’t post to YouTube myself, but because I was always logged in Google could track every YouTube video I watched.

If I ever want to post to YouTube I’ll create a new account that I use just for that purpose, and not leave myself logged in except when I’m posting.  Ditto if I ever decide to use Picasa, though I see that as much less likely.

Free of all need for a Google Account I deleted it.  I am now completely Google-Free.

 

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13 Responses to Google Reader and other customer tragedies

  1. josh says:

    Wish I could do it. Picasa is too sticky for me…

  2. conanon says:

    But I didn’t understand why did you go Google-free in the first place?

    • halberenson says:

      I don’t understand the question. Are you asking why I was Google-free before Reader?

      • conanon says:

        No, you specified how you switched from Google Voice to Skype + your carrier’s voicemail. And the fact that you actually deleted your Google account because you had no need for it. Why did you do it at all? Mostly people just let their dormants account exist be. And is this anti-Google or just what you do with all such useless accounts?

        • halberenson says:

          Now I understand the question!

          I didn’t really switch to Skype, it just crept in because (a) it does video calling and (b) it has better support in apps. Google Voice, for example, doesn’t have apps for my Windows Phone or Windows RT. I had to use third-party apps and those always had sync problems of one sort or another. Once Google dropped Reader I realized that Google Voice was the only service I was using and I was barely using it. The hassles with Google Voice combined with no other tie to the Google ecosystem made dropping it a natural step.

          With no tie to Google services the concerns about tracking and privacy take front and center. I see no reason to be tracked when there is no direct benefit to me. And I really don’t like to leave personal information floating around in places that I don’t actively visit. So deleting the account was purely a cleanup measure.

          Is this overall anti-Google? Well, yes. I do not find them a good steward of privacy. And I’ve rarely found their services compelling. But I’m not an overall Google-hater, I’d just rather do business with others. If my life was totally intertwined with Google Services I probably would accept the privacy tradeoffs because of the benefit I was getting, but that never was the case. Gmail has never offered enough reason for me to dump my near 15-year old Hotmail email address for example. Ok, maybe for a brief period I considered it because of SSL but Microsoft addressed that problem. So without a compelling case for using Google I chose to disassociate from them. Of course I can, and will, still use Google Search when I feel Bing isn’t doing the job. But Google will no longer be able to associate my searches directly with me.

  3. John says:

    I’ve been having a similar experience, except with Microsoft. The whole Windows 8 move was what precipitated it for me. After reading your very thoughtful and well-reasoned posts about how Microsoft likely decided to go the direction that they have with Windows 8, I understand and can really see why they have chosen to go with the course that they’ve gone with. I won’t bother you with all of the details, but I did want to “second” your thoughts on the point of this post. I think that you’ve once again delivered an accurate assessment, this time of a perhaps unintended or ancillary effect of a company’s strategic direction.

    • Tim says:

      Windows 8 has changed A LOT for me in my approach to Google. I was solidly using Google services prior to Win 8, and although I still use a few, I now question the need given what I have experienced with Win 8.

      When I converted three home machines to Win 8, purchased a Surface RT and finally a WP8 device, I realized that I had unintentionally switched from one ecosystem (Google’s) to another (Microsoft’s). Unintentionally, that is, except for when it came to WP8…by that time, I was sold on the integrated experience I was getting with Win 8 and wanted to “complete” it by moving to WP8.

      • halberenson says:

        This is part of why, despite disenchantment over lack of apps I care about, I have not moved away from Windows Phone. I am being drawn far more deeply into the overall Microsoft ecosystem, so there is a multiplier effect going on. Take a picture with my WP and it is present on all my Win8 systems. Be sitting on the couch and decide to watch the next episode of Fringe (which I just started watching, from the beginning) and I tap Play To Xbox for it to come up on my family room TV. When I go on a trip I can continue to watch the series on my Surface (and if I’ve remembered to download episodes that includes offline). I write up a grocery list using OneNote on a PC at home, add to it with my Surface while sitting in a restaurant, then pull up the list on my Lumia 900 when I get to the supermarket. And it all just works.

        The wave of products coming later this year will refine, polish, and extend these types of scenarios so that they are ever more compelling. Splitting across multiple ecosystems diminishes each of their values. And if you split across all three of the majors (Apple, Google, and Microsoft) as many people do, then throw in a few independents, your are light years away from what the experience should really be like. The pendulum that swings from “Best of Breed” to “Best Integration” is swinging. I think it will swing much more dramatically to the latter in the coming few years.

        • Tim says:

          Exactly. The interesting thing is, for as long my income has been attached to primarily MS-based technologies (e.g. .NET) I always lived a “double-life’ with respect to what I actually used day to day (Google). It wasn’t until after using Win 8 on multiple machines that I began to realize they had this whole ecosystem going…and quite nice at that. Certainly more convenient than what Google offered me.

          Microsoft has earned my business in these areas as they’ve done and continue to do a number of good things. Outlook.com, Sky Drive and Office Web apps, even smaller things like the people hub, not to mention services like Azure (for my work)…all look and feel really well-done.

          • Tim says:

            One more thing, to be fair: I still use quite a few Google services that I find are well done (Gmail, Calendar, Drive, Chat, Blogspot, Google+, Google Analytics). Some of these things I use infrequently, and most I now use alongside their MS counterparts, which is why I have considered switching entirely in those areas. Analytics is another matter…I know alternatives are out there, but perhaps the Azure team would consider including an alternative directly within the management portal.

  4. Pingback: Boot up: Q10 hands-on, Asus Transformer 2 review, Google opens patents, and more | Apple

  5. HGoldenH says:

    I hope you don’t mind that I shared on Google + ;-). Good insight about the process of evaluating products and their role in a company’s portfolio vs a customer’s technology portfolio. From a fellow Hal.

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