The application

Google introduced Google Photos (referred to as Photos for the remainder of this blog) in May 2015 (Sabharwal, 2015). Photos is an application that manages your photos and can run in your browser, on your desktop and on your mobile devices (i.e. smartphone and tablet). Photos allows you to upload an unlimited amount of photos* and videos* for free. Besides, the application provides great search functionalities (i.e. search for persons, places and things), share possibilities and smart creations (such as stories and after movies). Therefore, Photos has become the central place for all my 14.000 photos and videos. For an impression of Google Photos, please see the screenshot from Google below.

Google’s plan

Google provides numerous applications for free, such as Gmail, Chrome and Youtube. Photos is free too, but is different. A Google account comes with 15GB of free storage, combining data from Drive, Gmail and Photos. The uploaded pictures in Photos does not count toward that space limit*, while it requires plenty of data from Google’s data servers. There could be several reasons why Google provides the application for free. I will discuss two potentially main reasons related to Google’s business model in this blog post.

First, Photos could be the application to convince consumers to prefer Google’s cloud services to other cloud services from Apple or Microsoft. There is an ongoing battle for the internet services between Google, Microsoft and Apple (Arthur, 2014). All three companies want to win this battle, and Google does that by providing additional features and exploit data. Photos could be such a feature and extents Google’s current total offering. If consumers are convinced of Photos and want to adopt it, they may be more likely to adopt all Google’s applications. That is because a bundled offer encourages users to use all of the goods in the bundle (Fay & Mackie-Mason, 1999). Moreover, bundling information goods could be more profitable for Google as well (Bakos & Brynjolfsson, 1999).

Second, the photos consumers upload provide great insights into consumers live. The famous phrase: ‘’An image may be worth 1000 words’’ is very applicable in this case. Conventionally, Google had to base advertisements mainly on textual and clickstream data from Gmail, search behavior and other factors. By having more insights in consumers live (I’ve automatically uploaded roughly 14.000 photos and videos) Google can better predict what I like, what I do and where I am interested in. Therefore, the Photo application provides Google with great data than can enhance Google’s advertisements, and thereby Google’s profit.

Picture 1; cropped screenshot from Google Photos in the Google Play Store. 

Conclusion

Thus, Photos extents Google’s current offering and thereby tries to convince consumers to choose for Google’s cloud services. Besides, Photos unveil much information of consumers, making it possible for Google to better tailor advertisements. Therefore, the business model of Google (earning money via advertisements) is provided with additional data that allows Google to better tailor their advertisements towards the individual. And that data (i.e. value), is created and shared by consumers like you and me.

Written by;
Ivar van der Lugt – 418691iL

*As long as the photos are uploaded in Google’s ’High quality’.

Sources

Arthur, C., 2014. Digital Wars: Apple, Google, Microsoft and the Battle for the Internet. 2nd ed. London: Kogan Page.

Bakos, Y. & Brynjolfsson, E., 1999. Bundling Information Goods: Pricing, Profits, and Efficiency. Management Science, 45(12), pp. 1613-1630.

Fay, S. & Mackie-Mason, J., 1999. Competition Between Firms that Bundle Information Goods. Proceedings of the 27th Annual Telecommunications Policy Research Conference.

Sabharwal, A., 2015. Googleblog.blogspot.nl. [Online]
Available at: https://googleblog.blogspot.nl/2015/05/picture-this-fresh-approach-to-photos.html
[Accessed 8 February 2016].