Google: Riding the IoT wave to increased profits

How Google uses distributed devices to relay real-time traffic information

Have you ever wondered how Google Maps can tell how long it will take to reach your destination in real time? It turns out that over the better part of the last decade, Google has released a steadily increasing army of machines to report on traffic data around the world. No, these machines aren’t drones monitoring our highways. It turns out they don’t even have to pay for these machines to collect the data – we pay for them. That’s right, I’m talking about our smart phones.

Google aggregates location-based data collected from individual users of their Google Maps mobile application in order to better inform all Google Maps users of real-time traffic conditions. [1] Through the prevalence of Google’s Android operating system, and the fact that Google Maps came pre-installed on the early versions of the iPhone, Google was able to achieve critical mass with this data, and form a differentiating barrier between itself and other early maps competitors like MapQuest.

This critical mass that Google achieved created a virtuous cycle: the more users there are on Google Maps, the better the real-time traffic data becomes. The better-the real-time traffic data becomes, the more delightful the experience of the application. The more delightful the experience of the application, the more users there are on Google Maps, and so on. Additionally, as more users use Google Maps and Android in general, the amount of information Google has about its users increases. This allows Google to optimize its search product, from which the vast majority of Google’s profits are derived. In this way, Android and Google Maps act as loss leaders for Google’s search product. [2]

As shown by Google’s strategy with Android and Google Maps, it is clearly to Google’s advantage to keep people in their ecosystem, and to continue to push the boundaries of that ecosystem. One way that Google is pushing the boundaries of their ecosystem is through its foray into the Internet of Things. Two giant steps that Google has taken in the IoT world have been their $3.2 billion acquisition of Nest, and their recent release of Google Home, which is a competitor to Amazon’s popular Echo in-home product. [3][4] With Google Home, it is now that much easier for people to use Google’s search product – users won’t even need to be at a phone or computer to search for certain information. This only adds to the amount of data that Google collects about their users on a daily basis, which again it can use to tune its search algorithms.

One area where Google can demonstrate industry leadership is in the security of IoT. As internet connected devices become increasingly prevalent, so too do points of vulnerability, and these points of vulnerability are ripe for the hacking. Hackers worldwide salivate at the opportunity to make hacks as benign as turning your Nest thermostat to 80 degrees without your knowledge, or as malicious as taking control of your self-driving car remotely. An industry-wide effort is needed to appropriately secure these new internet-connected devices and remain one step ahead of hackers.

As evidenced by a hack just last month, where IoT devices were used to take down parts of the internet, there are plenty of unsecured devices out there. [5] The reason there are so many unsecured devices is because they generally require fewer steps to set up than secured devices. Google has released a platform called Brillo that allows users to program functionality into their IoT devices. Brillo is secure by design, and according to the platform’s website, secure by default – taking those extra steps out of the setup process. [6] Google can use the fact that their platform is both secure and simple to set up to their advantage, and push to become the go-to platform for IoT development. In doing this, more developers will come into the fold and develop within the Google ecosystem, continuing to expand its boundaries. (656 words)

[1] – Dave Barth, “The bright side of sitting in traffic: Crowdsourcing road congestion data,” Google Official Blog, August 25, 2009, [https://googleblog.blogspot.com/2009/08/bright-side-of-sitting-in-traffic.html], accessed November 2016.
[2] – Sneha Shah, “Is Google Making Motorola A Loss Leader?,” Seeking Alpha, December 4, 2013, [http://seekingalpha.com/article/1876911-is-google-making-motorola-a-loss-leader], accessed November 2016.
[3] – Aaron Tilley, “Google Acquires Smart Thermostat Maker Nest for $3.2 Billion,” Forbes, January 13, 2014, [http://www.forbes.com/sites/aarontilley/2014/01/13/google-acquires-nest-for-3-2-billion], accessed November 2016.
[4] – Andrew Gebhart, “Alexa who? Google Home wants to kick Echo off of your countertop (hands-on),” CNET, October 4, 2016, [https://www.cnet.com/products/google-home/preview/], accessed November 2016.
[5] – Jeff John Roberts, “Why Businesses Need to Secure Connected Devices to Win Consumer Trust,” Fortune, October 24, 2016, [http://fortune.com/2016/10/24/internet-of-things-security/], accessed November 2016.
[6] – “Brillo” [https://developers.google.com/brillo/], accessed November 2016.

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4 thoughts on “Google: Riding the IoT wave to increased profits

  1. This post actually solves a myth that has been in my mind for a few years: how google generates the time estimate to travel from point A to point B. I think it is very smart to use Google Map users’ location based data to generate useful information for all the travelers. It is a good example to show that how an industry leader can take advantage of its position to make positive impact on user experience and further consolidate its leading position. Next time when I use google map, I will keep in mind that I’m also helping thousands (if not millions) of travelers.

  2. Interesting post! One question/concern that came to my mind (especially based on the cases this week) is that of privacy. In a world where hacking is commonplace and Google has a sufficient amount of data on where people traveled, I can see this becoming problematic for high-profile individuals should this information become public knowledge (e.g., Watergate scandal). What is Google doing outside of Brillo to increase security in the age of IoT?

  3. Great post JimmySigner! The efficiency of Google Maps rests on the fact that users share their information with Google. However, most users do not share this information willingly or consciously (I’ll leave the choice of word to you). Hence, this model would be at risk if there were to be a consumer backlash against this indiscriminate use of data. How do you think Google should address these issues? Ultimately, Google’s lack of transparency could end up being its undoing.

  4. Interesting post! I had recently learned of how Google Maps estimates the travel time, by tracking smartphones, which really scared me. Google Maps has really revolutionized the map, by providing not only easy to read maps but also Street View, satellite photos, and route navigations. As much as I love Google Maps and find it extremely convenient, I do think the way they are using our smartphones to check traffic conditions is not very ethical. This basically shows us that Google can track our everyday movements, including where we live and go to school or work on a daily basis. Although I do believe in Google that they are only using this data to provide accurate forecasting of traffic conditions, I would support them using this data/information to fight crime and do good for society. If this were the case, I would not argue about the lack of openness on Google’s part, and allow for this tracking to continue without our full awareness.

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