Google: The Evolution of a Tech Titan
Google, a cornerstone of the internet experience for most users worldwide, began as a simple search engine developed in 1998 by Sergey Brin and Larry Page. Today, it operates as a subsidiary of Alphabet Inc. and manages over 70% of the world’s online search requests, solidifying its position as one of the most prominent brands globally. Its headquarters is located in Mountain View, California.
Google’s services have expanded dramatically since its inception. It offers a wide array of internet services and products, including email, online document creation tools, and software for mobile devices. The acquisition of Motorola Mobility in 2012 positioned the company as a hardware vendor capable of selling mobile phones. Google’s vast product portfolio and substantial market share have established it as one of the top four influential companies in the high-tech sector, alongside Apple, IBM, and Microsoft. However, Google’s original search tool remains fundamental to its financial success, with advertising revenue derived from user search requests accounting for a substantial portion of Alphabet’s revenue.
The Birth of a Search Engine
Brin and Page, who were graduate students at Stanford University, were driven by a desire to find meaning in the masses of data that were accessible on the web. Working from Page’s dorm room, they created a search technology called BackRub, which changed the way search engines worked. Rather than simply returning a list of websites based on how frequently a search phrase appeared, BackRub incorporated each website’s ‘backing links’. Websites with more links were deemed more valuable, and therefore ranked higher in search results. Additionally, a link from a website that also had many links was considered a more valuable “vote” than a link from a more obscure website.
Early Investment and Rapid Growth
In mid-1998, Brin and Page began to obtain outside financing. Early investors included Andy Bechtolsheim, a co-founder of Sun Microsystems, Inc. They secured about $1 million from various investors, family, and friends, and established their company in Menlo Park, California, under the name Google, derived from a misspelling of the mathematical term “googol.” By mid-1999, Google was processing over 500,000 queries per day. This activity accelerated in 2000, when Google became the client search engine for Yahoo!, one of the most popular websites on the Web. By 2004, Google was handling 200 million searches daily after Yahoo! ended their contract. The company’s growth continued. By the close of 2011, Google was processing approximately three billion searches per day, making “google” a common verb to describe searching the Internet.
Google expanded its infrastructure to accommodate the enormous amount of data, constructing 11 data centers worldwide, each containing hundreds of thousands of servers. The company’s operations rely on three primary coding components: Google File System (GFS) for data storage, Bigtable as the company’s database program, and MapReduce to generate higher-level data such as the index of web pages.
Management, Acquisitions, and Monetization
As Google grew, the founders recognized the need for experienced management. In 2001, they appointed Eric Schmidt as chairman and chief executive officer (CEO) of the company. During Schmidt’s tenure as CEO, Page became president of products, and Brin served as president of technology; the trio ran the company as a “triumvirate.” Google’s initial public offering (IPO) in 2004 raised $1.66 billion and created numerous millionaires among the early stockholders. The IPO employed an auction to sell shares publicly, aiming to provide average investors with the same opportunities as industry professionals. In 2006, Google was added to the S&P 500 Index.
Google’s strong financial performance reflected the rapid growth of Internet advertising. The company has strategically acquired several companies to bolster its advertising capabilities. For example, Google acquired Applied Semantics in 2003 for $102 million and dMarc Broadcasting in 2006 (also for $102 million). In 2007, Google acquired DoubleClick for $3.1 billion, and it acquired the mobile advertising network AdMob in 2009 for $750 million. These acquisitions were part of Google’s strategy to advance from its search engine business into advertising, which combines the databases of the various firms to help Google tailor ads to consumers’ preferences.
