Google Talk: Another Salvo from Google

August 26, 2005

Google Inc. moved one more step towards its goal of capturing maximum Internet time of net-users by launching Google Talk, an IM/Voice service on Wednesday ending months of heated speculation. The latest move by Google is seen by analysts as its attempt to become more of a media house where it will be competing against not only AOL, Yahoo & MSN but with IP telephony companies like Skype & Vonage.

This latest move by Google is seen as its attempt to get into VOIP as it is rumored to have bought some fiber optics in U.S. VOIP market and it has also invested in a company, which is working on delivering broadband over power lines. VOIP technology is lately seen as a disruptive technology, as it is expected to hit revenue of fixed line services once more & more people start migrating to Internet-based telephony services. The leading player of VOIP market is Skype which has clocked more than 153 million downloads since its inception in year 2003. As per estimates by Evalueserve, a research firm, Long Distance revenues for U.S.-based telecom operators is expected to decline by about 35-40 percent by 2008 due to the impact of Skype on the retail segment alone.

However, from a broader view, Google talk is part of the strategy where the Do-no-evil company wishes to capture maximum share of the Internet hours of the users by launching more & more services, be it desktop search or gmail. From news services, to photo-editing tool, to Hello (photo exchanging site) to blogging tool or social networking tool, there is little bit of Google in all activities we do on the net. Hence, no wonder Google is way ahead of Yahoo & MSN in total searches with more than 36% share of search market, and has been able to capture major share of online advertising dollar.

Hence, at first look, Google Talk might not look great guns in comparison to Skype but is going to be a winning fit as part of overall Google strategy.

Concluded.

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