GAMEY Grow by “Throwing it at the Wall”
Posted by Mike Bijon February 21, 2006
The GAMEY group of companies - Google, AOL/Amazon, Microsoft, eBay, and Yahoo - have been grouped based on their growth by frequent buyouts and other acquisitions. Recently all of them have been criticized for a lack of creativity and execution ability, both for the strategy of growth by buyout and for building poorly thought products with no clear track to profits. Especially with the enormous prices placed on them, it’s easy to think of Flickr, Picasa, Skype, and Weblogs, Inc. as branded assets that carry “extra” value based on market-share, user count, etc.
I disagree that there are market-cornering strategies and “brand value” behind the new acquisitions and products. The execution behind new products like Google Blog Search and Windows Live Ideas appears to be as much about throwing something new at the wall and seeing if it sticks as it is to complete the master plan of a team of MBA’s. Those business decisions may seem haphazard, but the truth is that the internet and GAMEY in particular are growing up to be more like brick-and-mortar suppliers and less like the razor-focused, genius-run companies they’re often cast as.
I see a close correlation between GAMEY’s recent behavior and the typical behavior of large consumer goods companies. Frequent test products, new brand launches, and acquisitions are typical of packaged consumer goods companies, like Proctor & Gamble and Unilever. Long-standing brands are still used to create a relationship with customers, but they’re extended with new versions, advertising, and a willingness to make false starts. Buyouts even acquire products that compete with existing in-house goods - often to gain production efficiencies (maybe traffic and server efficiencies for GAMEY) and products that appeal to different classes of customers. This comparison makes the reasons Yahoo bought out so many “Web 2.0″ startups, how Google can continue to add new products when current ones aren’t even monetized, and even why Amazon would build its own search engine and a music player & store to compete with the iPod & iTunes seem much less glamorous and a lot more buttoned down.
Mike Bijon: I work as senior technology manager and technologist for 
