Google Will Regret Shutting Down Google Reader

Google's decision to retire Reader will force many of the company's top users into its competitors' web of services - and not just their RSS services
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The past few years have seen unprecedented growth in the scope of the products and services offered by the major technology players. While their business models differ, these lumbering giants understand the need to considerably diversify their offering in order to enhance their core businesses and insulate their users from competitive overtures. This strategy, which largely defies strategic management theories of “core” and “non-core” capabilities, has been pioneered by Google. Over the past decade, the company has launched close to 350 products and services – two thirds of which are ad-free. Despite this, advertising continues to constitute 95% of total revenue.

This why Google’s decision to retire Google Reader today is so incredibly surprising and foolish.

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Google’s culture of experimentation personifies the Silicon Valley credo of “failing fast and failing often”: More than 1/3rd of the products and services it has brought to market have since been shut down. Yet, Google Reader differs from the dearly departed Google Health, Buzz and Wave in a few important ways:

1. Usage of the product provides clear customer insight. The websites a user follows and stories they read are strong indicators of their interests, as well as their preferred sources of information.

2. Google Reader users appear to be high value customers. They’re technologically savvy (and therefore likely to use multiple technology services), large consumers of information (Google’s mission is to “organize the world’s information and make it universally accessible and useful”) and influential (it is widely touted by journalists and news aficionados alike).

3. While Google states the product’s popularity is in decline (and total users remains unknown), the userbase is not insignificant in size. Feedly, a leading heir apparent, claims to have added 8M users since Google announced Reader’s pending demise. Given the likelihood that many (such as yours truly) have yet to pick a new service, its’ possible the total count of Reader users was in
excess of 25 million (at least 2.5% of Google Search’s December 2012 users). Furthermore, usage of the service was intense – with the majority of users accessing it numerous times a day (between mobile and online I likely check it countless times a day, reading an average of 55 articles a day, and 68,000 since February 2010).

One could argue that Reader provides Google with little incremental user insight. However, Google’s decision is problematic not because of point number one, but two and three.

Google has always said “competition is a click away”. That’s true, but only narrowly. The information Google has on each of its users is at the heart of their ability to deliver relevant search results (and advertisements). While it may take little effort to try one of Google’s competitors, it will take these services time to learn enough about you to deliver truly competitive results. In addition, becoming a Microsoft user (versus just a Bing user) takes considerably more than a single click. You’ll need to set-up multiple new services, port over your content, distribute your new contact information and so on. This stickiness keep users from moving to any of the services offered by Microsoft, Apple, Yahoo etc. – even if they are readily available.

The end of Reader is forcing millions of Google’s most active users to adopt new services offered by the company’s competitors. Digg (a social network of sorts) and AOL have already released RSS readers in response – and rumors of a forthcoming Facebook Reader persist. Using these not only means setting up a new user account (a major barrier), it constantly exposes users to these companies’ services. Now Google’s own offerings are “a click away”, its competitors, after all, are right there on the users screen.

To this end, I’m shocked Microsoft and Yahoo haven’t been working furiously to release its own service. Like many of you, I have a Microsoft account – but I haven’t used it for years. A great RSS reader would have me logging in dozens of times a day, something none of their existing products or services comes close to achieving. Furthermore, the product would help the companies dramatically increase mindshare among Reader’s vocal and influential users.

Google may be right that services such as Twitter and Facebook have “socialized” the news and that RSS will remain as niche news channel. But its decision to abandon the service is unnecessarily driving many of its best users to embrace the RSS services of its competitors. Ending Reader support may free up some headcount and drive the focus Larry Page cares so deeply about, but is this really worth it? I don’t think so.

Unfortunately, it’s too late to for Google to change its mind. Developers – both independent and corporate – have been tirelessly hiring, coding and testing their products in order to be ready for Reader’s D-Day. A reversal now would come with immense scorn from the developer community and public accusations of scorched-earth capitalism. The end of Reader has put Google between the proverbial rock and a hard place – and they can only blame themselves.


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COMMENTS
  • Will Meneray

    Great article. Two thoughts come to mind, though slightly unrelated:

    1. While this may be the death of Reader, I’m not convinced it’s necessarily the death of RSS or similar types of products for Google. My guess is that there’s some type of deeper integration with Google+ forthcoming. Clearly they see their nascent social network as the ultimate long term play and the more than can move services into that ecosystem, the better (in theory) it will become. For example, I can imagine the “circles” feature being quite useful for the purpose of sharing articles in particular (i.e. share stupid buzzfeed articles with my friends and family but more intelligent, topical ones with my colleagues). As someone who doesn’t use Google+ at all, they could leverage my interest in some Reader-like utility to get me onto the platform and perhaps slowly interest me in some of its other features.

    2. Any thoughts on Ezra Klein’s article on GReader. I tend to agree that unlike something more serendipitous like Twitter (on occassion, anyway…) Greader did limit the size of the internet, especially if you’re not a fan of “link-y” posts. Not sure that there’s a solution to that problem or that it’s necessarily even a problem to begin with (part of Google Reader’s appeal was that it made the internet’s endless content feel more manageable), but I’d be interested in what you think. http://www.washingtonpost.com/blogs/wonkblog/wp/2013/07/01/google-reader-dies-today-heres-why-im-not-replacing-it/

    • Matthew Ball

      Your first point makes a lot of sense – and has historically been true. When Google killed Google Reader sharing, for example, they were looking to drive that behavior to Google+. That being said, if Google did have a “forthcoming”, “long term play” for RSS in Google+, they made a mistake in shutting down Reader before this product was available (ideally, it would have been a progressive integration). By shutting down Reader early, the company is unnecessarily forcing users to adopt (and then adapt) to new services which would compete with Google+Reader, only some of whom they would be able to reacquire at a later point in time. In addition, it would prevent them from deploying their famous A/B testing to see how faithful Reader users were taking to its Google+ incarnation.

      As for Mr. Klein’s piece. He mentions three reasons for abandoning RSS after the death of Google Reader: 1. He typically ends up limiting himself only to RSS blog content, rather than “reading, well, everything else”; 2. He feels stuck in Eli Pariser’s aptly-named ‘Filter Bubble’, where the information and opinions he is exposed to through RSS suffers from extensive selection-bias; 3. As a corollary of number two, he worries that he is less likely to find new blogs/writers that neither he nor his RSS’d bloggers read.

      I’m not really convinced these are insurmountable or even significant problems. Mr. Klein’s says he follows 135 feeds and “can’t keep up with feeds that publish too frequently”. This seems prohibitively excessive. For reference, I follow only 32, of which 10 publish only a few per week and another 10 fewer than two per month – and constantly add and remove subscriptions. Were he to reduce the size of his feed, he’d be able to solve problem #1 (stuck reading blogs all day), which would also force him out of his RSS reader, in turn making him more likely to discover outside content and authors (#2 and #3). I also think his points on #2 and #3 are somewhat inflated. Many of my favorite bloggers, such as Felix Salmon, routinely link to the multitude of opinions they’ve read in the formulation of their pieces or to which they agree or disagree. While the filter bubble is still at work, contrary opinions are only ever a search away – or in many instances, but a click away if one wants. Furthermore, services like Twitter or Reddit (which Mr. Klein uses) will help him find new blogs and opinions.

      I also use Google Reader because I like to be in-front of the news or a consensus (someone has to initiate social curation, after all). For my work, it’s particularly important that I’ve been able to read and digest a multitude of different opinions and perspectives before forming my own. It’s hard to do this when you rely purely on social services like Twitter or Reddit, or by drinking straight from the fire hose (i.e. canvassing the Internet as a whole). Furthermore, with the pace of today’s news, it can be almost impossible to catch up on what you’ve missed without it.

      Critical though RSS is for me today, it certainly can be an anxiety-inducing part of my life. I would love to see an improvement (and the return of social sharing via RSS).