Google GPS

Google just keeps dropping bombs all over the web, and its latest product offering is already making huge waves. Last week, Google announced that it would provide free turn-by-turn GPS maps to mobile devices. Reaction was sharp and immediate: GPS-makers saw their share prices plummet.

It's hard to compete against a giant like Google when it gives away its products for free. Just like with the Android mobile platform, Google is giving away its GPS maps product for free in order to build up its mobile search market. So it's hard for the other mapmakers to compete against Google when all of their profits come directly from the map technology and Google's profit comes from the search revenue delivered indirectly by the map technology. Google's complementary search product is so strong that it has a huge competitive advantage in almost any field X it enters since it can afford to off-set any direct losses on product X with indirect search revenue, so long as that product can add to Google's search market share.

What's even more interesting is that sometimes Google even pays for others to use its product. For example, with the Android platform, Google will actually pay you ad splits to use certain licensed versions of its software. This "less than free" model is even more bad news for anyone competing against the search giant.

Who will be next to fall under the mighty axe of Google?