As the Internet grows, so does Google

In two insightful posts, "The Omnigoogle" and "The cloud's Chrome lining", Nick Carr cleanly summarizes how Google benefits from the growth of the Web and why expanding Web use makes sense as a large part of their business strategy.

Some excerpts:

[Google] knows that its future ... hinges on the continued rapid expansion of the usefulness of the Internet, which in turn hinges on the continued rapid expansion of the capabilities of web apps, which in turn hinges on rapid improvements in the workings of web browsers .... [Chrome's] real goal ... is to upgrade the capabilities of all browsers.

The way Google makes money is straightforward: It brokers and publishes advertisements through digital media. More than 99 percent of its sales have come from the fees it charges advertisers for using its network to get their messages out on the Internet.

For Google, literally everything that happens on the Internet is a complement to its main business. The more things that people and companies do online, the more ads they see and the more money Google makes.

Just as Google controls the central money-making engine of the Internet economy (the search engine), Microsoft controlled the central money-making engine of the personal computer economy (the PC operating system).

In the PC world, Microsoft had nearly as many complements as Google now has in the Internet world, and Microsoft, too, expanded into a vast number of software and other PC-related businesses - not necessarily to make money directly but to expand PC usage. Microsoft didn't take a cut of every dollar spent in the PC economy, but it took a cut of a lot of them.

In the same way, Google takes a cut of many of the dollars that flow through the Net economy. The goal, then, is to keep expanding the economy.