Google - PESTEL & Porter's Five Forces Analysis

2373 Words Aug 10th, 2014 10 Pages
GOOGLE: PESTEL & Porter’s Five Forces Analysis

Table of Contents

1. Introduction

2. PESTEL Analysis

2.1 Political

2.2 Economic

2.3 Social

2.4 Technological

2.5 Environmental

2.6 Legal

3. Porter’s Five Forces Analysis

3.1 Threat of New Entrants

3.2 Threat of Substitution

3.3 Supplier Power

3.4 Buyer Power

3.5 Industry Rivalry

4. Conclusion & Recommendations

5. References

1.0 Introduction

Google Inc, a global technology company, founded in 1998 by Larry Page and Sergey Brin, is the most popular search engine in the world. Google provides numerous free services and products such as Google search, YouTube, Google Maps, and has transformed how people use and share information.

Google’s business spans from
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Technology rapidly advances, and Google actively takes measures to ensure they do not fall behind. According to Bloomberg data, Google has acquired 127 companies in the past three years (as cited by Farzad, 2014). Besides buying companies, such as Waze, a GPS navigation software, and Admeld, an advertising optimisation platform, in a smart defensive play to acquire companies that poses a threat to its business, Google has been acquiring a wide range of technological companies from Humanoid robots to Airborne wind turbines to Home automation devices.

In a bid to strengthen its business, Google is increasingly moving into developing hardware technology that has a tangible presence in consumer’s homes and offices.

2.5 Environmental

It is estimated that Google runs over a million servers in data centres worldwide, with its first Southeast Asia data centre in Singapore operating since 2013, and consumes a huge amount of electricity. Every time someone makes a search or sends an email, they contributes to the electricity bill at Google’s data centre (Tan, 2014).

However, Google argues that they have made the world a greener place considering the electricity consumption for a search in lieu of a drive down to the library. Above all, unlike other companies, Google builds most of their own data centres down to the energy-saving chips it uses, and custom-designs its servers