Date: 2024-10-07 Page is: DBtxt003.php txt00016819 | |||||||||
Technology / Analytics | |||||||||
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Burgess COMMENTARY Peter Burgess | |||||||||
| TECHNOLOGY Here's Why Google Just Spent $2.6 Billion to Buy a Startup You've Never Heard Of Google's parent company, Alphabet, announced that Google Cloud will acquire Looker, a data analytics and business intelligence service. CREDIT: Getty Images Google's parent company, Alphabet, announced that it has scooped up Looker, an analytics and business intelligence startup. It's the company's largest purchase since it bought smart-home technology maker Nest for $3.2 billion in 2014, and its fourth-largest overall. The acquisition was made by Alphabet's Google Cloud division, which competes directly with Amazon Web Services (AWS) for cloud-based computing and database tools. Basically, Looker helps businesses make sense of the data they generate. It's especially good at managing multiple streams from different databases that you use to store information (say from your website, customer relationship management tools, e-commerce store, call center, and manufacturing facility) in a way that makes it easy to compare, visualize, and make decisions. It's a big deal. Sure, Alphabet had over $100 billion in revenue last year, but $2.6 billion is still a big deal--both in dollars and in impact. It's a big deal because of what it means: Google Cloud is going big after enterprise customers. While Alphabet has served small businesses through products like its G Suite productivity software and GoogleAds products, Google Cloud still lags far behind both AWS and Microsoft's cloud products in the enterprise market. This acquisition starts to change that by giving it a powerful player in the data analytics space. Google wants your data. Look, Google, the company that pretty much collects every piece of data floating around the internet, is buying a company that helps make sense of data collected around the internet. Google wants to be more than just your business email and advertising partner. ADVERTISING inRead invented by Teads The company, which makes most of its money (as much as 85 percent) as the world's largest advertising platform, appears to be looking to solidify its position in other areas. Big data is easily one of the most interesting and important industries and it's one Google is just beginning to serve. If you happen to be an enterprise-level customer or need full-service end-to-end database solutions, Google wants to provide them. Even if you aren't, keep reading. I think Google is looking for your data too. Google wants to play nice. There's another reason. It doesn't hurt Google that Looker plays nice with other major database providers from Amazon, Oracle, or Microsoft, or that the company says that will continue. Google certainly has something to gain by looking less like a monopolistic behemoth as it comes under increased scrutiny by federal investigators at the Department of Justice. It also gives Google Cloud a product that allows customers of its cloud-based services the ability to connect to database software from other providers, which makes it a much more attractive option moving forward. I think we'll see how nicely the company wants to play when we see what types of data protection conditions Google is willing to accommodate to avoid giving regulators additional reasons to take an interest in its business. Google wants you in the cloud. Even if you're not an enterprise customer, this deal matters to you. Google has a history of making previously complicated or inaccessible products available to the masses. While Looker is no doubt an enterprise-level software tool, I wouldn't be surprised if, in the future, Google makes the core functionality available to small and midsize businesses on a smaller scale. Even as the company expands into serving new markets--in this case, big-data enterprise analytics and business intelligence--it also usually finds a way of expanding access to those same products to the rest of us. There once was a time when getting a branded email address for your business required a whole lot more than a six-dollar-per-month subscription to G-Suite. Google made website analytics accessible, for free, to millions of small businesses, and made it possible to set up advertising campaigns that target your exact audience in just a few minutes. You can even use it now to order lunch. None of those were accessible the way we think of them until Google took something that was previously available to large businesses and offered it to everyone. Whether that will happen with this purchase, I don't know, but one way or another, Google now has 2.6 billion more reasons to be interested in your data. THE PLAYBOOK | 0:54 One Tip on Getting Acquired, From a Founder Who Sold His Company to Apple The opinions expressed here by Inc.com columnists are their own, not those of Inc.com. More from Inc. | |||||||||