Google Network Impact Case Study

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Register to read the introduction… This is where a product or service is in such a way that its value to a potential customer is dependent on the number of customers already using good or service. The total value of service that possesses network effects is proportional to the square of the number of customers already using that good or service. Google gets more public perception compared to its rivals like Microsoft. However the consequence of a network effect is that the purchase of a good by one individual indirectly benefits others who own the good. E.g. By opening up Gmail account by a person makes his/her friend’s Gmail accounts more useful. A product's success is due to compatibility and conformity issues, not that the product or technology may be superior or inferior to the competition. This implies that network effects occur when higher sales of a product or service increase its value and therefore leads increase in sales. In the case of Google, its online ad network has continued to grow at a faster rate than its closest competitors, though Microsoft had the highest network growth in 2009 by 31%, but also Google was the second in growth by 13% from 8% in 2008 better than Yahoo with …show more content…
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