Facebook vs. Google: The Ultimate Showdown for Your Attention

by Kyle David on November 13th at 12:23 pm EST

Facebook and Google have long (in internet years) dominated as the top two players on the internet and lived harmoniously together.  However, ever since September when it was reported that Facebook overtook Google as the #1 site on the internet, Google has begun to see the seemingly innocent Facebook as threat worth noticing.  Within a month, Google stopped allowing users of Gmail, to share their Gmail account information with Facebook in order to find more friends.  Now, this week sources have confirmed that Facebook has acquired the fb.com domain name and announced that it is holding a special press conference on Monday.  Many are speculating that Facebook will be launching an email service similar to Gmail.

So other than nerdy rivalry, ego jousting, financial chess moves, why is it necessary for a company like Facebook to enter the email space?  The answer is not just to generate traffic, but to generate quality traffic. As the internet grows, it’s becoming harder and harder to source quality traffic, because it all seems to come from the same places: Google, Facebook, and Twitter (sometimes).  As a traffic originator, these sites have extraordinary marketing firepower that directly turns into dollars.  It is what I have long called the paradigm of originated traffic versus secondary traffic and occurs not just on the internet.

I’ve always explained this relationship in terms of mortgages.  When you purchase a home and apply for a home mortgage, the mortgage broker or bank makes an unholy amount of money for getting a few signatures from you.  This is why you are forever seeing those ubiquitous spam emails for mortgages (among other things), getting pelted with offers in the mail, and likely have someone all up in your grill the minute you decide to curiously walk into an open house.  In industry terms, these banks or brokers are called “mortgage originators.”  They write and secure the first lien on your house and are entitled to foreclose on you first in the event of default.  They make big bucks for it.

Then there are other types of mortgages that can be written against a home.  There are home equity lines of credit, second mortgages, etc.  You likely don’t get nearly half as many offers for these types of loans.  Why?  Because they hold a distant back seat to your primary mortgage, cost more, are less secure, and the broker or bank makes far less money on them.  They are good business if you can write a lot of them, but crumby business if you can’t. 

So what the heck does this have to do with the internet?  Google, Facebook, and Twitter (among some others) are all traffic originators.  You go to them to find out where else to go and that position makes them extremely valuable to advertisers.  For every click generated from a search result it has been estimated that Google profits anywhere from 5-15x what they do from their AdSense contextual advertisements that are displayed on secondary websites.  It it’s for good reason.  They have first crack at your attention and with an attention deficient internet population that’s a very valuable place to be.

Gmail has long been an anchor of traffic origination because it’s normal for someone to start an internet session with email.  However, Google has been swift to put provisions in that they remain the #1 traffic originators with the Chrome browser and Android mobile platform.  Google is on a non-stop offensive to ensure that they are #1 with our attention.  This is why getting knocked out of that spot by Facebook, who doesn’t have the browser, mobile platform, search engine, or email system (not to mention about 18K fewer employees) has knocked them out of their number one spot.  That could spark the beginning of a significant financial upswing for Facebook with the price being paid by Google diminished ability to capture your attention. 

The speculated announcement that Facebook may be launching an email service doesn’t particularly surprise me as more people are starting their internet session with Facebook and THEN going to their email. Assuming that their service doesn’t suck, an email service keeps you engaged with Facebook, when you might normally be going to Gmail.  Though personally, I far prefer everything Google at the current moment, I have to give a hand to the underdog.  Bling, Bling Facebook.  I imagine that this is the beginning of a war.