Google's social networking weapons

slide_dotcom.jc.top.jpgGoogle snapped up five social networking companies last month. For a look at its newest acquisitions, click here. By David Goldman, staff writer


NEW YORK (CNNMoney.com) -- Google has quietly been stocking up on tools it will need to challenge Facebook in the social networking game, and says it's on the verge of launching a "social component" to a number of its core products.

Over the past month, Google (GOOG, Fortune 500) has made five acquisitions in the field: SocialDeck, a mobile social gaming company; Angstro, a social networking search application; Like.com, a social fashion store; Jambool, a social gaming virtual currency; and Slide, a social game maker. It also has a large stake in gaming giant Zynga.

But before you start to arrange the puzzle pieces, analysts say don't bother.

"Trying to predict how Google will put everything together using acquisitions is a fool's game," said Josh Bernoff, analyst at Forrester Research. "It's highly unlikely that the pieces will emerge into some form."

Google has a habit of making acquisitions to buy up talent, not products. Bernoff believes many of the recent deals were done to pick the brains of the companies' engineers, who have experience with social networks.

So what's all this for?

After months of secrecy, Google finally began shedding light on its plans at last week's Zeitgeist conference in Arizona. Schmidt told reporters that Google would not be coming out with one new social network product. Instead, it plans to will unveil social networking tools that will be woven throughout its existing products and Web applications.

It's the opposite of what Google has done -- and failed at -- in the past. Big social products like Orkut and Buzz have largely flopped, and Google's collaborative tool Wave was recently canned. It was the Microsoft approach: build big product after big product and hope that one eventually sticks.

Google's new approach is more incremental -- which plays to the company's strengths.

"Rather than bang its head against the wall trying to create a competitor to Facebook, Google appears to have come to the realization that all of its applications and assets have social aspects that can be extruded," said Al Hilwa, analyst for IDC. "It's more of a mall than a department store approach."

It's a strategy that many companies -- including Facebook -- are starting to employ. "Social" on the Internet is not about a destination, but about the ability to discover, share and discuss content on the the Web with others.

Social features are popping up in all kinds of applications, with Apple (AAPL, Fortune 500) adding "Ping" to iTunes and news publishers integrating Facebook's "Like" button throughout their sites.

It's a crucial element that Google has been largely missing out on. With 178 million visitors to its sites in July, Google is the most-trafficked Web entity in the world and has 33 million more visitors per month than Facebook, according to comScore.

But Facebook has been outpacing Google in referrals to portal sites (directing people to other websites' home pages) since February, according to Compete Inc. That's troubling for Google, since its business model relies on selling ads that direct traffic.

Some Google products like Gmail and YouTube already incorporate elements of a social network, like status messages, instant messaging, commenting and media sharing. However, the social layer has eluded Google's largest product, search -- even though Google's PageRank algorithm is at its heart a social tool, factoring user behavior like linking into its results.

Building richer social networking features into its offers could help Google better analyze users' preferences, and better target ads to them. But first, it will need to wrap its head around the social mindset -- something it's struggled with so far. Exhibit A: Buzz's troubled rollout. Stocking up on social media upstarts -- and the creators who built them -- could help Google fine-tune its approach.

"If you imagine a very likely future when social is a part of everything you do online, the end goal will not be to create a single product or site to capture that," Bernoff said. "If Google can provide a social structure around its products, it's much more likely to maintain its relevance." To top of page

Frontline troops push for solar energy
The U.S. Marines are testing renewable energy technologies like solar to reduce costs and casualties associated with fossil fuels. Play
25 Best Places to find rich singles
Looking for Mr. or Ms. Moneybags? Hunt down the perfect mate in these wealthy cities, which are brimming with unattached professionals. More
Fun festivals: Twins to mustard to pirates!
You'll see double in Twinsburg, Ohio, and Ketchup lovers should beware in Middleton, WI. Here's some of the best and strangest town festivals. Play
Index Last Change % Change
Dow 16,960.57 -123.23 -0.72%
Nasdaq 4,449.56 -22.54 -0.50%
S&P 500 1,978.34 -9.64 -0.48%
Treasuries 2.47 -0.04 -1.59%
Data as of 4:18am ET
Company Price Change % Change
Facebook Inc 75.19 0.21 0.28%
Bank of America Corp... 15.59 -0.03 -0.19%
Ford Motor Co 17.62 -0.22 -1.23%
Applied Materials In... 21.23 -0.52 -2.41%
Intel Corp 34.25 0.00 0.00%
Data as of Jul 25

Sections

The food processing company accused of mishandling meat at its Shanghai, China plant says it will suspend sales and recall all food processed there. More

Is the economy back on track after a weak first quarter or about to get blown away? Investors will find out when the curtain is drawn on jobs and GDP data. There's also a Federal Reserve meeting. More

Louisiana is now the top location for motion picture filming, supporting thousands of new jobs and small businesses. More

Americans with disabilities face huge financial hurdles and it starts early on, according to a recent report. More

Market indexes are shown in real time, except for the DJIA, which is delayed by two minutes. All times are ET. Disclaimer Morningstar: © 2014 Morningstar, Inc. All Rights Reserved. Disclaimer The Dow Jones IndexesSM are proprietary to and distributed by Dow Jones & Company, Inc. and have been licensed for use. All content of the Dow Jones IndexesSM © 2014 is proprietary to Dow Jones & Company, Inc. Chicago Mercantile Association. The market data is the property of Chicago Mercantile Exchange Inc. and its licensors. All rights reserved. FactSet Research Systems Inc. 2014. All rights reserved. Most stock quote data provided by BATS.