Google Inc (GOOGL) VS Facebook Inc (FB): Switching Costs and User Habits Are The Decisive Factors


Google Inc (NASDAQ:GOOGL) and Facebook Inc (NASDAQ:FB) are the two companies massively focusing in reinventing the online and mobile ads in the contemporary tech world today. Google Inc (NASDAQ:GOOGL) being the search engine juggernaut and an old experienced player has the clear lead with 60% ads market share. But Facebook is drastically increasing in ads efforts to come in the game. In an article, Rick Summer said that Google Inc (NASDAQ:GOOGL) is clearly the world leader in ads business and it will continue to be because the clients do not find it easy to switch to other platforms. Facebook Inc (NASDAQ:FB) has the edge in the mobile ads business because of its apps and social platform Instagram. Google Inc (NASDAQ:GOOGL) is also trying to shift its focus on mobile.

The source said that even in the coming years, Facebook Inc (NASDAQ:FB) ads business growth could only make Google Inc (NASDAQ:GOOGL) share go down by 3 to 7 points and not more than that. Summer thinks that powering more than 500 million mobile devices around the world with Android gives Google Inc (NASDAQ:GOOGL) an ample advantage over Facebook Inc (NASDAQ:FB). 90% of the mobile searches are done on Google Inc (NASDAQ:GOOGL). The users are not interested in switching to any other platform in search, ads or online money making.

GOOGL Copyright Infringement

Google Inc (NASDAQ:GOOGL)’s mobile revenue including the Google Play apps and other services was $12 billion in 2014. This would grow as the Android market share will elevate in the coming days, especially in the Asian markets. Facebook Inc (NASDAQ:FB) could use Instagram and WhatsApp to tackle Google Inc (NASDAQ:GOOGL)’s penetration in the ads business, but this would take a while.

 David Tepper’s Appaloosa Management Lp owns around 600,000 Google Inc (NASDAQ:GOOGL) shares.

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