The Business Environment and its Effects on Google

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This report analyses the external environment of Google, currently the world’s largest internet search engine, and identifies the main priority issues which are likely to affect the company in its short term future.

Six areas of the business environment are analysed in this report, these include the political, economic, socio-cultural, technological, legal and ethical environments.

The Political Environment

Via its search results and video sharing website YouTube, Google plays an increasingly significant role in shaping the political environment of countries such as The United States and The United Kingdom.

This influence has occurred largely as a result of YouTube providing politicians and political party leaders with a cost effective means of communicating with a large number of people, and also, due to the fact that an increasing number of people are using Google’s search results to find out information about political candidates during national elections.

As the number of internet users is predicted to increase over time, Google’s political influence is also likely to increase as more individuals start to use Google owned services to search for political information.

The recommendations of this report are that Google should become more involved in regional and national elections throughout countries of the world by stressing the political advantages of the services that it offers.

The Economic Environment

Unlike the large majority of companies throughout much of the developed world, Google has experienced increased demand for its services and increasing profit levels as a result of more businesses advertising with Google in an attempt to mitigate the effects of a slowing economy.

In the short term future, Google is likely to further increase its profit levels regardless of whether the economy stays the same, gets worse or improves as there is a growing trend towards businesses advertising online, especially local businesses.

The recommendations of this report are that Google should contact businesses directly and explain how Google’s services and advertising programmes can help to increase sales and revenues. In addition, because technical knowledge may pose a barrier to entry for some business owners, Google may benefit from providing information on how to get a business started online.

The Socio-cultural Environment

Google is a multinational corporation that provides its services to many countries throughout the world. The more internet users a country has, the greater the potential demand from those countries will be for Google owned services.

Although internet usage is fairly pervasive throughout the developed regions of the world, in less developed regions, such as Africa and Asia, only a small percentage of the population have regular access to the internet.

The primary reasons for this are a lack of telecommunications infrastructure and also low wages which result in individuals being unable to afford devices such as laptops or computers to access the internet. By increasing the number of internet users in less developed countries, Google could significantly increase the demand for its services.

The recommendations of this report are that Google sponsor or support initiatives to provide telecommunications infrastructure and low cost laptops to individuals living in less developed regions of the world. Doing so is likely to increase revenues, create brand loyalty and may even help Google to gain market share in countries where it is not the dominant search engine such as in China.

The Technological Environment

Advances in technology are changing the way that people access the internet. For example, devices such as mobile phones, tablet PCs and even televisions mean that people no longer have to use a traditional desk bound computer to conduct their internet activities.

Whilst such devices are predicted to increase the number of internet users throughout the world, and increase the frequency of internet usage, Google faces strong competition for these users from Apple, Facebook and search engines Bing and Baidu due to the popularity of social networking and Google’s slow response to new technological developments such as mobile phones and tablet PCs.

The recommendations of this report are that Google should conduct a PEEST analysis of its marketing environment and SWOT analysis of its competitors, so that it can operate more effectively in the technological environment by identifying future trends and new market segments it could exploit.

The Legal Environment

Google has had legal action taken against it as a result of copyright and privacy violations with its Library and Street View programmes, and also with the caching of search results and videos hosted on YouTube.

As Google expands its online activities and the range of services that it offers, Google is likely to experience more legal disputes. The rise of mobile phone and television internet usage may also expose Google to future legal action as a result of the services it provides on such devices.

The recommendations of this report are that Google takes steps to respond quickly to copyright or privacy complaints so that it may positively enhance its brand image in matters of this regard.

The Ethical Environment

Google has been criticised for contradicting its own view of having a free and open internet by censoring its search results in China. Criticism has also been directed at Google for the way that it tracks and stores user data, and the appearance of offensive websites in its search results.

Such criticisms are likely to increase as Google expands the range of services that it offers, especially when it is operating in countries whose culture differs significantly from Google’s own “Americanised” culture.

The recommendations of this report are that Google continue to operate in China as it represents the world’s largest number of internet users and is therefore important to Google for increasing demand for its services and increasing profit levels.

Outside of China however, the recommendations are that Google continue to display its search results using an algorithmic approach and avoid manual manipulation of results wherever possible to maintain its values of having a free and open internet.

For devices such as tablet PCs, mobile phones and internet enabled televisions, Google should use the lessons that it has learned from existing criticism to minimise future complaints about its services and how it conducts its business activities.

Contents List

 Executive Summary

 Contents List

 Section 1 – Introduction

 1.1 Background Information
 1.2 Terms of Reference
 1.3 Scope

 Section 2 – The Business Environment and its Effects on Google

 2.1 Political Factors
 2.1.1 Short Term Effects

 2.2 Economic Factors
 2.2.1 Short Term Effects

 2.3 Socio-cultural Factors
 2.3.1 Short Term Effects

 2.4 Technological Factors
 2.4.1 Short Term Effects

 2.5 Legal Factors
 2.5.1 Short Term Effects

 2.6 Ethical Factors
 2.6.1 Short Term Effects

 Section 3 – Conclusions

 3.1 Political Conclusions

 3.2 Economic Conclusions

 3.3 Socio-cultural Conclusions

 3.4 Technological Conclusions

 3.5 Legal Conclusions

 3.6 Ethical Conclusions

 Section 4 – Recommendations

 4.1 Political Recommendations

 4.2 Economic Recommendations

 4.3 Socio-cultural Recommendations

 4.4 Technological Recommendations

 4.5 Legal Recommendations

 4.6 Ethical Recommendations

 Bibliography

Section 1 – Introduction

Three main points will be introduced in this section of the report. Background information on Google as a company and the types of online activities it is engaged in, the aims of this report, and finally, the scope of the business environment this report intends to address.

1.1 – Background Information

Google is the world’s largest internet search engine with a global market share of 66.8% of internet searches (Lipsman, 2009). Although it specialises in search, Google also provides services such as email, video streaming, translation, social networking, news, maps and an operating system for mobile devices.

1.2 – Terms of Reference

This report aims to identify key issues in the business environment which affect Google, and how Google can operate more effectively within this environment.

1.3 – Scope

This report will identify the main priority issues of Google’s external environment by examining how political, economic, socio-cultural, technological, legal and ethical issues are likely to affect Google in the short-term future.

These issues have been chosen due to the global scope of Google’s business activities as they help to highlight important issues from different aspects of the business environment which affect Google.

Section 2 – The Business Environment and its Effects on Google

This section of the report looks at some of the main priority issues in Google’s business environment and how those issues are likely to affect Google in its short-term future.

2.1 – Political Factors

Google plays an active role in shaping the political environment in some of the countries in which it operates. During the 2008 US Presidential elections for example, Google launched a “You Choose 08” campaign on its video sharing website YouTube that displayed video messages from the candidates, debates and also provided a way for the public to interact with those candidates through the submission of online text and video questions (Catone, 2007).

The increasing influence of YouTube and Google’s search results on the US political environment has been dramatic. During the 2000 US Presidential elections for example, 9% of Americans said that they had learned new information about the campaign from the internet, a number which rose to 13% during the 2004 elections and to 24% during the 2008 elections (Noff, 2008).

An interesting side effect of this increased political exposure has been to give lesser known candidates a much larger audience than their campaign budget would normally have allowed them to reach with traditional newspaper or television coverage. One such candidate was Ron Paul, who, in the lead up to the election received more campaign donations than any other Republican candidate, largely as a result of his YouTube videos and the subsequent viral spread of the “Ron Paul Revolution” campaign (Malcom, 2008).

Evidence of Google’s influence on the political environment can also be found outside the United States. British Prime Minister David Cameron for example, has appeared on YouTube answering questions submitted by the public and also has a YouTube “channel” for the Conservative party (Warman, 2011). Google itself also regularly comments on major political issues such as during the 2007 French (Esper, 2007) and 2007 Australian (McLaughlin, 2007) elections on its “Public Policy Blog”.

2.1.1 – Short Term Effects

YouTube is clearly a very powerful political tool, and so it is not surprising to see politicians using it to communicate with potential voters during election time and by governments to communicate with the general public once they are in office.

As the number of internet users increase throughout the countries of the world, Google’s role as a political platform is likely to increase both in the short and long term future as more politicians and governments use YouTube to cost effectively reach a wide audience.

This may even lead to new candidates and political parties quickly gaining in popularity, as shown by Ron Paul, and potentially, disrupting the established political landscape composed of the traditional major parties.

3.1 – Economic Factors

Whilst most businesses in the current recession, especially those in Europe and North America, have had to reduce the size of their workforce due to decreasing demand and slowing economic growth, Google has remained remarkable resilient in this challenging economic environment. In 2010 for example, Google’s net profit was $2.17 billion, up by 32% from 2009 (New Statesman, 2010) largely as a result of more businesses advertising with Google due to the slowing economy (The Telegraph, 2008).

Market share has remained relatively stable for Google. In the United States it has a market share of 66.6% and continues to be the dominant search engine throughout most countries of the world (Flosi, 2011) experiencing an overall increase in demand (searches) from the rapidly growing number of internet users across the globe (BBC, 2010). In response to this increased demand, Google plans to increase the size of its European workforce by 20% in 2011 (Sweney, 2011).

Google does face some potential economic challenges however, as politicians in the United States and Europe have accused Google of tax avoidance (Macalister, 2009) by channelling money through Ireland and Bermuda which currently saves Google around 3 billion dollars a year (Foley, 2010).

3.1.1 – Short Term Effects

Google appears to be benefitting from the downturn in the economy as it is forcing more businesses to go online to try and increase sales and revenues. If the global economy continues to get worse, some businesses may be forced to shut down their physical stores and operate entirely online. If this occurs, Google is likely to experience further increased revenue as many of these businesses will start advertising with Google.

If the global economic situation improves, Google is also likely to experience increased revenues as with more individuals having access to the internet and using it for everyday activities, businesses that are not already online, may be forced to make a web presence in order to serve these potential online customers.

In order to survive and recover from economic depression, many countries, particularly those in North America and Europe, are looking for ways to reduce spending and decrease their national debt. Google, who has already been accused of tax avoidance, may be used to help such countries reduce their debt by increasing the amount that Google is taxed should Google’s current tax activities be declared illegal.

4.1 – Socio-cultural Factors

Google is a multinational corporation that provides its services to many countries throughout the world. Approximately 75% of all Google searches are conducted outside the United States (Preda, 2010), making demographic analysis a key component in projecting both short and long term demand for Google search, Google owned websites and Google related products.

Of particular interest to Google is Africa with a population of 1 billion and Asia with a population of 3.8 billion, as despite having such large populations, these regions of the world have relatively small numbers of internet users. In Africa for example, 10.9% of the population use the internet and in Asia 21.5% of the population use the internet. A similar pattern can be found in China, who, despite having only 22.6% of their population online, has around 300 million internet users as a result of their growing population numbers (BBC, 2009).

This can be contrasted to North America where 77.4% of the population and Europe where 58.4% of the population use the internet (Internet World Stats, 2010). As more individuals throughout these regions of the world begin to use the internet, Google is likely to experience an increase in demand for its services in the foreseeable future.

One factor that may limit Google’s growth in developing countries however, is the widening gap between those who have access to communications technologies and those who do not, something that is greatly influenced by the socio-economic strata of a population. Half of the world’s population for example, make less than $2.50 a day which limits ones ability to be able to afford to buy a computer or pay to use the internet (Shah, 2010). Although things are starting to slowly change.

In Africa there are now programmes to make the internet much more available and cost effective to larger numbers of people, even to those living in rural areas (BBC, 2007). Falling technology costs are also making computers much more affordable and thus allowing more individuals to access the internet especially those from poorer backgrounds. The Indian government for example, is developing a £7 laptop that it hopes will help to reduce India’s “digital divide” (Blakely, 2009).

The rise in internet culture throughout many countries of the world is also benefitting Google, and will likely continue to do so as more people have regular access to and use of the internet. Teenagers in The United States and The United Kingdom for example, now spend more time online than they do watching TV or being with their family (Weaver, 2011). Older adults are increasingly beginning to spend more time online also, as internet usage is rapidly becoming the norm in developed countries (Hogan, 2009).

4.1.1 – Short Term Effects

Google is likely to experience a slower increase in demand for its services as internet usage reaches saturation levels in developed countries such as The United States and The United Kingdom. However, in less developed areas of the world such as Africa and Asia, Google is likely to experience a rapid increase in demand from countries in these regions as internet usage becomes more available and technology becomes more affordable.

Furthermore, as internet usage becomes more pervasive within society and incorporated into its culture, Google services relating to social networking, shopping and search are also likely to experience an increase in demand as more individuals begin to use their computers to conduct activities online which they previously would have conducted offline.

5.1 – Technological Factors

Due to the rapidly changing nature of technology, the technological environment is perhaps the one in which the most significant of Google’s priority issues can be found.

The internet, upon which Google’s services are predominantly based, is now reaching an audience beyond desk bound computer users to users with mobile phones, tablet PCs and even television viewers via Google TV. By 2013, the number of people accessing the internet via a mobile device is expected to increase to 56.2 million in the United States, more than 10 times the amount of mobile users in 2008. As a result, Google revenues from search advertisements are also expected to increase (Lovings, 2009).

However, despite the ever increasing number of internet users and the fact that more businesses are starting to advertise online due to the downturn in the economy (Stanic, 2009), Google may not be benefitting as much as it potentially could do as more local businesses are turning to Facebook to advertise than to Google as a result of a growing trend towards social networking based marketing as opposed to traditional search based marketing (O’Neill, 2011).

Facebook is also challenging Google’s dominance in terms of its popularity, as in 2010 it overtook Google and claimed the title of the most visited website in the United States (Nuttall and Gelles, 2010), a trend that is expected to spread throughout other countries of the world (Clark, 2010). Google also faces increasing competition from Microsoft’s search engine “Bing” and Chinese search engine “Baidu”, both of whom are slowly eating into Google’s market share of internet searches (Watters, 2011).

5.1.1 – Short Term Effects

Because the way people are accessing the internet is now beginning to change, Google is likely to see an increase in demand for some of its newer services such as Google TV and its Android operating system for mobile devices. This in turn is likely to result in increased brand awareness for Google, and increased demand for its primary services such as Google search and YouTube videos.

However, facing major competition from Facebook, Microsoft’s Bing search engine and Chinese search engine Baidu, Google may ultimately find itself losing market share even though overall demand continues to increase.

More businesses for example, are beginning to advertise on Facebook than on Google as shown by local business advertising. This is a trend which may extend to larger businesses as they try out new advertising models. Bing and Baidu are increasing their market share for internet search at the expense of Google, although due to the increasing number of internet users each year, Google search volume will most likely continue to grow.

6.1 – Legal Factors

Google has come under an increasing amount of criticism as a result of the way it conducts its online activities. The New York Times for example, has accused Google of violating copyright by caching its website pages thereby allowing some users to bypass content which was intended only for registered users (Olsen, 2003).

There have also been copyright accusations directed at Google’s Library programme which has published scanned books online without first asking for the author’s consent resulting in Google being taken to court (Shiels, 2010).

YouTube, Google’s video sharing website, has also been subject to copyright accusations and legal action. In Germany and Italy for example, Google was found guilty of violating copyright law and ordered to remove several videos (Edri, 2010).

Furthermore, Google’s Street View programme which aims to capture images of the world’s streets, has landed Google in yet more legal trouble with the revelations that Google collected over 600 gigabytes of data from unsecured domestic Wi-Fi networks without requesting owner consent (Shiels, 2010).

6.1.1 – Short Term Effects

Google is likely to experience continued criticisms and legal disputes as it continues its Google Books and Street View programmes. Google is also likely to experience such difficulties as it develops new products and expands its presence on the internet, especially with activities that involve the use or tracking of personal user data.

As mobile devices and televisions become more common means for accessing the internet, Google may also face legal disputes from owners of content that Google displays to these devices.

7.1 – Ethical Factors

As a multinational corporation Google’s American culture and values have been challenged in some regions of the world. This has most notably occurred in China, where Google was asked to filter search results sensitive to the Chinese government from the Chinese people, something which Google does not normally do and is against. Google later redirected Chinese users to its Hong Kong site to provide a less restrictive service, although currently it is still required to filter terms such as “Tiananmen Square” from its search results pages (BBC, 2006).

Google has also experienced an ethical dilemma in how it should track its user’s activities. Cookies for example, are placed on a user’s computer and record that user’s activities on any Google owned website. Google also stores data from all its user’s searches, leading some to criticise Google on the grounds of violating their privacy.

However, Google claims that such tracking and collection of user data is needed in order for Google to be able to continually improve its services (Google, 2011). In response to criticism that Google does not make it clear what it does with user data, Google has since update their privacy policy after admitting it was “too vague” (Waters, 2007).

Another ethical issue that Google faces comes from the search results it displays to its users. Google’s policy is to make the internet free and open to all without censorship. As a result, changes that are made to how its search engine displays its results are carried out algorithmically rather than via manual intervention. This however, has lead to the public being exposed to sites which promote hate, violence, pornography and other material Google’s users may find offensive.

7.1.1 – Short Term Effects

As Google expands its services into new countries throughout the world, it is likely to received ethically based criticism if it is forced to censor its search results as it did in China. This is most likely to occur if Google enters a country that has a radically different culture to its own “Americanised” culture, and in some cases, perhaps in Islamic Middle Eastern countries, Google’s culture may even hinder its ability to operate effectively with its current products and services.

Furthermore, as Google services become more accessible to the widespread general public through mobile devices and televisions, and as Google develops new services, there are likely to be fresh concerns about how Google tracks and stores its user’s data which may in turn lead to further legal action being taken against the company.

Section 3 – Conclusions

This section of the report provides a brief conclusion of each of the main priority issues in Google’s external environment.

3.1 – Political Conclusions

Google, particularly through its sister site YouTube, is clearly becoming a significant influence in shaping the political environment of countries throughout the world, most notably in The United States and in The United Kingdom where all major political parties use YouTube to communicate with potential voters and to reach a large audience in a cost effective way.

Furthermore, an increasing percentage of the population are using the internet to acquire political news and to learn new information about candidates whom they are interested in. One candidate who benefited from this was Ron Paul, a relative underdog who, through the power of viral marketing, became a well known and popular candidate on the internet, especially with young voters.

As internet usage becomes more prevalent throughout the world, Google’s role as a political platform is likely to be strengthened as candidates and governments from different countries use YouTube to communicate with the public and to potential voters.

3.2 – Economic Conclusions

Google has experienced increased demand for its services and increased profits during a time of economic slowdown when many businesses are experiencing the reverse. Google has in fact appeared to benefit from the downturn in the economy, as it has forced many businesses to start advertising online with Google in an attempt to increase sales and revenues. As a result of this increased demand, Google is expanding its workforce in the United States and in Europe.

Google’s large revenues have resulted in some politicians criticising the way that Google conducts its tax activities, accusing the company of tax avoidance. As North American and European countries look for ways to reduce their national debt, Google may be forced to pay more tax if its activities are deemed to be illegal.

3.3 – Socio-cultural Conclusions

Africa and Asia contain the majority of the world’s population yet have relatively low numbers of internet users; 10.9% and 21.5% respectively. Increasing the availability of the internet to individuals in less developed countries will therefore boost the total number of global internet users, the demand for Google services and subsequent Google revenues from those services.

The digital divide is however, beginning to close thanks to programmes which aim to make the internet more available and affordable to those living in rural areas. The falling cost of technology is also for the first time making personal internet access a feasible option for poorer individuals in countries such as India.
For those individuals living in developed countries who already have regular access to the internet, the use of the internet is becoming ingrained within culture as more and more people, especially those from the younger generation, are spending increasing amounts of time online to socialise and purchase goods.

3.4 – Technological Conclusions

New means of accessing the internet such as via mobile devices and televisions will lead to an increased number of internet users in the coming years and a likely increase in demand for Google’s services.

However, Google faces formidable competition for current and future internet users from Facebook, which now attracts more local business’s for advertising than Google. Furthermore, Microsoft owned search engine Bing and Chinese search engine Baidu, are slowly eating into Google’s search engine market share.

As a result, new competitors mean that it is unlikely that Google will remain in the number one position for all the services it offers and will most likely experience a decreased market share for some of its services in both the short and long term future even though overall demand is still predicted to increase.

3.5 – Legal Conclusions

Google has been accused of violating copyright laws and has been successfully taken to court to remove copyrighted material from offending websites. Google has also received criticism for collecting data from unsecured domestic Wi-Fi networks as part of its Street View programme, leading some to question how much Google values user privacy.

As Google continues to expand its Google Books and Google Street View programmes, it is likely to experience more criticism and copyright violation claims. This is also likely to be the case as Google develops new products and expands its presence on the internet.

3.6 – Ethical Conclusions

Google is a multinational corporation that provides its services to many countries throughout the world. As a result, Google’s culture may sometimes clash with the cultures of other countries forcing Google to modify the way it provides its services.

In China for example, Google’s open and uncensored approach to the internet clashed with the Chinese governments views of what sort of information their citizens should be allowed to see. In order to continuing operating in China, Google was forced to censor its results just as Microsoft and Yahoo were forced to do.

Google has also been criticised on ethical grounds for the way it tracks and stores user data. Although Google claims such tracking and storage is necessary to be able to improve its services, users have complained that Google does not make it very clear how it treats user data and for how long that data is kept. In response to these criticisms, Google released an updated privacy policy after admitting that its existing policy was “too vague”.

Google’s algorithmic handling of its search results have also lead to ethical criticisms being directed at Google, as this has lead to some offensive sites benefiting from public exposure. In the interests of a free and uncensored internet however, Google stands by its algorithmic approach.

As Google continues to expand its operations into new countries throughout the world, especially into those which have a radically different culture than Google’s Americanised culture, Google is likely to come under increased amount of ethical criticism if it is forced to go against its traditional beliefs and values of how the internet should operate. In addition, as Google develops new services, there are also likely to be fresh concerns about Google’s use and tracking of user data.

Section 4 – Recommendations

This section of the report provides a series of recommendations on how Google can interact and operate more effectively within each area of its external business environment.

4.1 – Political Recommendations

Google, primarily through its sister website YouTube, has played an increasingly significant role in shaping the political environment, at a national level, of countries such as The United States and The United Kingdom.

This has occurred as a result of political candidates and party leaders using YouTube to communicate to a large audience in a cost effective way. In addition, Google’s political influence has been further strengthened as a result of members of the general public using Google search services to inform themselves about political matters and about specific candidates.

As the use of the internet becomes more common throughout other countries of the world, Google is also likely to play a significant role in shaping the political environment on a global scale and this is something that Google could use to its advantage.

One such way in which Google may benefit is through the effect its political influence could have on its brand image. For example, in the 2008 US presidential elections, the lesser known candidate Ron Paul received a significant boost to his popularity largely as a result of his online promotional activities.

If such trends continue in the future, Google may be able to position itself as an organisation that helps to give all political candidates an equal opportunity to speak to the public no matter what their budget may be, and also, as an organisation which promotes greater transparency of political candidates by providing the general public with a means of easily finding out more information about their favoured candidates.

To operate more effectively in its political environment, Google could therefore focus on increasing public awareness and exposure to political candidates at a regional and national level of countries throughout the world and also by promoting its own role in helping to create freer and fairer elections.

If Google is effective in promoting such a message and positively enhancing its brand image as result, this may in turn help to offset the effect of any criticism Google has directed at it, such as those relating to privacy concerns.

However, such beneficial effects will likely only be possible if Google maintains a neutral political stance. If it is seen as favouring one political party over another for example, Google’s brand image is likely to be negatively rather than positively affected.

4.2 – Economic Recommendations

The recent economic downturn seen throughout many countries of the world, such as those in Europe and North America, has placed Google in a unique and enviable position. Whereas many businesses are experiencing decreased demand for their products or services, and consequently decreased revenue and profitability, Google is experiencing the reverse; increased demand for its services and increasing profits.

This has largely occurred as a result of more businesses advertising online to increase the size of their served market segment and mitigate the effect of fewer visitors to traditional brick and mortar establishments. Advertising online also provides businesses with a cost effective means of running their operation and reducing overhead costs, potentially resulting in significant cost savings if they choose to operate entirely online.

To operate more effectively in its economic environment, Google could take a more proactive approach by contacting and encouraging businesses, especially local and small businesses, to create their own website and advertise with Google through its AdWords programme, something that may even be promoted as a way of “beating the recession”.

However, as technical expertise may pose a barrier to entry for less technically able business owners, Google may also want to provide information on website design and basic steps for getting a business online. Doing so will likely increase Google’s short and long term profitability by having more businesses advertise online with it, and may even provide Google with a means of creating brand loyalty and thus discourage people from advertising with rivals such as Facebook or Microsoft.

Tax wise, Google is coming under increasing criticism for what some view as tax avoidance, even though its activities are perfectly legal. Although Google may never escape from such criticism, it may be able to mitigate its effects by increasing charitable activities, such as by making donations to worthy causes, and perhaps, also by focusing on corporate social responsibility programmes such as Google funded schools or community centres.

4.3 – Socio-cultural Recommendations

As a multinational corporation, Google’s services are used by individuals throughout many countries of the world. However, although internet usage is approaching saturation levels in regions of the world such as North America and Europe, other regions of the world, such as Asia and Africa, still have a relatively small proportion of their population using the internet or with regular access to the internet.

One of the main reasons for this is due to the lack of telecommunications infrastructure in underdeveloped countries and the expense of owning devices, such as computers or laptops, which are capable of accessing the internet.

Considering the fact that Google’s profitability as a company is largely dependent upon the demand for and usage of its services, Google could potentially significantly increase its level of profits, both in the short and long term future, by making the internet more available to individuals living in less developed regions of the world.

Google could for example, sponsor or support the development of telecommunications infrastructure and provide individuals or families with a low cost “Google laptop” to access the internet in regions of the world where the internet is currently inaccessible or too costly to access.

Adopting such a strategy could benefit Google by increasing its brand awareness and creating customer loyalty, which may then provide further benefit by potentially helping Google to increase its market share in countries where it is not the dominant search engine such as in China.

Furthermore, because less developed countries tend to have a wider population base (i.e. contain a larger proportion of younger adults), Google may be able to challenge Facebook’s dominance in social networking by creating loyalty with younger internet users for its social networking site Google Buzz or its upcoming Google Circles.

As of yet, Google has been unable challenge Facebook’s dominance, although it may potentially be able to do so if it can establish such services in Asia and China which collectively contain the large majority of the world’s population, and thus, the majority of the world’s internet users.

4.4 – Technological Recommendations

The rapidly changing nature of technology is changing the way that people access the internet. No longer is internet usage confined to a computer or laptop, but now, mobiles phones, tablet PCs and even televisions can provide internet access. As a result, more individuals are beginning to use the internet and are using it more frequently.

Google however, has been relatively slow to react to such technological changes which has subsequently lead to companies such as Apple capturing significant market share for mobile devices with its iPhone mobile phone and iPad tablet PC, both of which provide internet access.

If Google is to become competitive in such areas, it must be able to identify new means of internet access or uses of the internet so that it can establish itself within such markets and build up its user base so that it can dominate a given market segment before other companies are able to do so.

Google does appear however, to have learned from its mistakes in the mobile phone and tablet PC markets, as it is currently well positioned to challenge Apple in television internet access with its Google TV service.

To identify future trends and new market segments, Google may benefit from conducting a PEEST analysis of its marketing environment with the use of environmental scanning to monitor and analyse components of its micro and macro environment. A SWOT analysis may also prove useful in helping Google to respond more effectively to its competitors by analysing their strengths and weaknesses and the corresponding opportunities and threats.

4.5 – Legal Recommendations

As shown by Google’s Library and Street View programmes, in addition to its video sharing website YouTube, legal factors can play a significant role in restraining the growth, and possibly even development, of current and future Google services.

As a result, this is perhaps one of the most challenging environments in which Google currently operates, as all businesses must conduct their activities within the boundaries of the law. Being able to identify such boundaries however, may not necessarily be such a straight forward affair as laws and regulations can vary amongst the different nations of the world meaning that what may be legal in one country, may in fact be illegal or prohibited in another.

Furthermore, as Google has already discovered, violations of the law can lead to court action and criticisms from the general public about how Google conducts its business activities. All of which, can have a negative effect on the image of a company.

Although it is unlikely that Google sets out to intentionally break the law, when such violations do occur, Google should act quickly and correct the violation in accordance with the law to minimise any negative consequences of its actions.

This could be done for example, by responding quickly to copyright violations and seeking owner consent prior to using material, such as scanning books, for its services. Google could also make it easier for content owners to contact Google and report any copyright infringements.

By developing a reputation of responding quickly to such complaints, members of the general public and private businesses may become more trusting of Google which in turn could help to positively increase Google’s image as a company. In addition, earning such trust may also help to benefit planned future Google services, such as those relating to “cloud computing” which involve users storing their data on Google servers rather than on their own computer.

4.6 – Ethical Recommendations

The main challenges Google has experienced in its ethical environment have been related to how it uses and displays its data. In China for example, Google was criticised for censoring its search results even though it was ordered to do so by the Chinese government and its competitors, Bing and Yahoo, were already censoring their results without being criticised for doing so.

In China, Google faced a very difficult ethical dilemma. Should it stick to its beliefs and values of having a free and open internet, but risk missing out on the worlds largest internet market? Or should it comply with the Chinese government and try to establish itself in what could prove to be a very profitable decision?

Although Google did initially stick to its belief in providing uncensored search results by routing visitors to Hong Kong, as of 2011, Google does censor some of its search results to its Chinese users.

It appears however, that Google can do little about this if it wants to operate in China as it must do so within the boundaries of Chinese law, and for the most part, this seems to be reasonably well understood and tolerated by internet users from outside of China and so Google has not suffered from much damage to its image or reputation.

At present, Google is justified in operating a censored service in China, as in the future, it may be able to operate without censorship. However, should Google be discovered to censor results outside of China for its own benefit, its company image will likely suffer. For this reason, Google should continue to provide its search results algorithmically, and avoid manual intervention wherever possible.

Another major criticism Google has faced relates to privacy concerns and how long it stores user data. Fortunately, Google has responded quite effectively to such criticisms by explaining why it tracks and stores user data, reducing the length of time it stores user data and by making it clearer to its users what Google does with its data. As Google develops new services for tablet PCs, mobile phones, internet enabled televisions and cloud computing, Google should use the lessons it has learned from such criticisms to prevent future concerns from its users.

In particular, Google would benefit from having an easily understandable and clear privacy policy, and being honest and open about what it does with its user’s data.

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Reviewed – 27th March 2016

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