Middleman: How Amazon and Google Ended Up Doing Shady Stuff

Middleman: How Amazon and Google Ended Up Doing Shady Stuff

An explainer of how you can change the world and then break the promise because now you are too powerful.

Google is a powerhouse in search engines. A search engine is nothing but a database that matches your query and comes up with the link when you think about it. It's easy to develop algorithms when simple queries are searched, and a handful of databases exist. For example, when you have only one database for the word 'Biden', then you turn out only one link for the query 'Biden'. But if there are millions of links with a particular word, then a search engine does a great job of turning your query into a relevant search. It's a vicious cycle. You start by doing a good job; more users search on your website. Now, you have a lot of data to improve algorithms, and the cycle keeps on going. It could have been any search engine. It happened to be Google.

Compare this with Amazon, an e-commerce company. It promised fast delivery of anything. Initially, it was making a loss. But because it kept its promise with the help of many retailers and dumping money, they got more customers. And over time, they have the logistics to move goods fast at low cost. More customers keep coming, more sellers want to join them, and they get bigger - the cycle keeps ongoing. And you have e-commerce which is too big to ignore. If you are online, you have shopped from Amazon or will soon.

Other competitors are often playing the catching up game. But these companies are monopolies. And they don't want to acknowledge it. Because in many countries - there are laws to prevent a company from becoming a monopoly.

Google Empowers

As a website owner, you need to have a proper distribution channel. So, you look up to search engines because that's the holy grail from where the traffic will flow. Nobody will know your website or brand unless you do paid advertising. So, search engines give you the hope to succeed. All you have to do is answer the query. Google has improved algorithm over the years - 11 major ones and many small ones.

As a new website, you can rest assured that you even have a chance to outrank other websites when what content you have is relevant and more nuanced for the search.

This is in line with how you search the web. Initially, you searched for a single term - for example - Football. For this, there are limited high-quality old websites that will rank. And they will be tough to outrank. But now, your search for very specific things like - best football passes in team X analysis. For this query, a smaller website focused on football analysis might be a better search result.

Amazon Empowers

Amazon initially started as a book company. They promised to sell every book. They didn't have the inventory. Initially, when you bought the book, they would buy the book and then ship it to you. Over the years, Amazon has thousands of sellers with whom you can buy. And you get your goods delivered almost asap. It's possible because of the huge inventory they have now and the logistics they grew from within.

Let's try to see Amazon from a writer's point of view. If you want to get a book published - traditional publishers are hard to reach, unresponsive and have unrealistic edit demands. Amazon came in and promised to publish your book as it is. Your book is available for the world to download. They also have paperback options and digital options, so you can be available at multiple places with multiple formats.

And you can do all of this from the comfort of your home. Fifty shades of grey and Martian are self-published books.

There are many success stories of being self-published in Amazon and being successful. This gives hope to millions of writers who won't ever get a chance at traditional publishing. You can simply write your book and get famous, money or a shot at becoming one. Which traditional publishers don't have the decency to even reply to your submission.

Amazon has inspired many other brands to help the creators self-publish and become the go-to place for new, edgy and all-inclusive stuff. Because Amazon allows anyone to publish their book - literally anyone's book and ideas and topic are published by Amazon. So, you get a variety like none other. Amazon pushed the self-publishing model to its height.

Google Becoming Search Results

Google's revenue comes from advertising. And they devised a perfect mechanism for the huge revenue—a bidding system. So the merchants would keep on bidding high because if not, the other merchant would get the spot. And so began the race of outbidding each other. But it doesn't matter which merchant got the ad; it was Google who was winning.

Let's take an example of below: selling a $10 product at a $9 margin. And so is your competitor. Initially, you bid on a keyword for $1. So

Google = $1

Your revenue = $8

After some time, Google approached your competitor and showed how you were getting $8, so that competitor got bidding and bid $5. So

Google = $5

Your competitor revenue = $4

This kept on happening, and eventually, you won with a bid of $8.99. Because that's the highest, you can go. And if you didn't bid that, your competitor will. So,

Google revenue = $8.99

Your revenue = $0.01

As you can see, you and your competitor went from earning $9 to Google earning all that revenue. Couple this with the fact that there are too many advertisers. And Google is the leading ad exchange available on the market - you can see why Google is a mega-giant company with billions of dollars in advertising revenue.

Thus, Google realized one thing - they can get amazing revenue by making sure people didn't click on websites and stayed on the search results. So the ad clicks on search results will shoot up.

Individual websites can be a part of Google Adsense or not; they can have one ad or none. And even if you clicked on the ad, Google gets 40 per cent, and 60 per cent goes to the website owner. What if Google wanted to gulp all the 100 per cent of the revenue. Ideally, it won't happen if Google stuck to the search results. But Google snatched the search info and displays information right on search results. So most people won't click on the website. Also, many websites have been crushed by Google because Google now has made the replica of their website as a Google search feature. Some websites like calendar, cricket or baseball match information, election information, calculator, etc. For most of the information, Google takes data from third parties. Still, instead of showing that website as search results - Google shows their information with editing from Google, so you stay on search results.

Thus, now you aren't competing with other websites. You are competing with Google itself on search, and they will copy your features, articles and make a replica of them. And of course, Google's own service will be first in the search result.

Amazon Self-publishing Scam

Amazon encourages you to self-publish your book. Because it knows they will not promote your book, not help with the distribution and so on. They give you the feeling of millions of customers, but you won't be put in front of them. But that's a promise they make, so you self-publish your book.

And then there will be no sales. You will tell your friends and family who will buy your book. And Amazon makes a nice cut out of it. It means you gave Amazon a cut to sell to your friends. Which you could have done via Gumroad much more efficiently.

Sure, there are outliers in self-publishing which sells a lot. But often, they are heavily promoted by the author. A lot of money is involved. So, an average person who wants to access Amazon's distribution is scammed. Because there is no distribution. A lot of books, almost all sell only one copy on Amazon. But Amazon doesn't have a problem with that. Because combined that represents millions of books, so Amazon earns millions of dollars per month or day. And that's the self-publishing dream as promoted by Amazon for you.

Google And Amazon = Monopoly

Google has a monopoly on search engines. And Amazon has a monopoly on e-commerce, especially ebooks. So, if you want to get a shot - either pay lots of money or dance to their tune. This is the grim reality.

Of course, there is another way—for example, tribes of people supporting and exchanging good stuff like Reddit. Slowly, there will be many such communities. Because what Google and Amazon promised has been flushed down the drain since they wanted to earn all the money.

And at this point, they are too big of a company. They control everything. And you have little to no power.

But if you can start a community or be part of one where new ideas are encouraged, flourished and cherished. Maybe Web 2.0, where bloggers linked more often and shared each other's ideas, was the best phase. We just need it back for literally all the things on the internet.