[crdoconnor]

>the advertising business is essentially funding all their other ventures, which have the potential to replace the ad business and continue the cycle.

I'd never make a bet on any corporation being willing to branch out into something new that will cannibalize its core business. It just doesn't happen. Ever.

[NamTaf]

He's not saying it'll cannibalise the core business, he said it'd replace it by becoming a bigger profit centre. For example, Nintendo started out in playing cards and went via hotels among other things before arriving at electronics.

[dylanjermiah]

Yep :) One day search will not be relevant, Google is trying very hard to figure out what will be important.

[pchristensen]

Apple replaced the iPod Mini (their best selling product) with the iPod Nano. Apple's iPhone project has vastly superseded their Mac and iPod lines. I don't know the split on Facebook's mobile vs web advertising, but if mobile hasn't passed web, it's heading that way fast. Honda cars outsell Honda motorcycles. IBM sells business services, not mainframes, etc.

[ElijahLynn]

In the new book "How Google Works" Eric Schmidt talks quite frequently about the need to be able to innovate even if that means cannibalizing your own products. Because if you don't then someone else will. And when that happens, you die off.

Most incumbants die from not cannibalizing their own products. Innovation is the key to survival.

[nostrademons]

Android. Google's core business is searching & indexing the web, and then they went and created a mobile OS that siloes information in individual proprietary apps. It seems to have worked out for them, because a.) Android has the potential to be bigger than Search anyway and b.) they've worked out deals to crawl the content of apps.

[crdoconnor]

>Google's core business is searching & indexing the web

Google's core business is selling ads. Android doesn't cannibalize that, it extends their dominance in ads to mobile.

It ain't like people have stopped googling things on their phones now that they have apps, either.

[nostrademons]

Mobile ads are less effective - there's less screen space available for them, and CPCs are lower, as Wall Street analysts have pointed out every conference call since 2013. Most of Android's revenue comes from the 30% cut Google Play takes.

[jfoster]

Amazon started Kindle & Kindle books, which heavily cannibalized their sales of physical books.

[crdoconnor]

Their book business has not been their core business for more than a decade.

Nonetheless, I suppose cannibalizing their ex-core business is pretty exceptional.