Beware The Days Of Facebook And Google

Facebook and Google are familiar names to the hundreds of millions of people who use their services everyday. But they have grown to control online digital advertising to an alarming extent.

Crushing the competition

Facebook and Google have raced ahead of the competition in the digital advertising space to account for the vast majority of online activity.

They are well positioned to gain from what is a rapidly growing sector and capture an even greater share of a much larger market in the next decade.

The on-going shakeout in what is an extremely lucrative digital advertising space has seen Google and Facebook reach unassailable levels of profit.

Other players like Yahoo (even with its recent sale) and Twitter come a very distant third and fourth in a market that screams for competition to stop what is an effective duopoly.

Digital advertising is a new industry and set to grow at a tremendous rate but reform is needed to ensure opportunities flow to a wider base of companies.

It is also necessary to curb Facebook and Google as they win disproportionate clout, global influence and unimaginable cash reserves in worrisome measure.

Customers get a good deal from such arrangements as the respective platforms make it easier to target customers but it comes at the cost of yielding personal privacy in a stealth like way.

Jobs too are lost in traditional advertising and other firms as market share and associated profits shift from a myriad of smaller companies to two colossal winners.

Fighting for the future

Yahoo’s recent sale may give it a chance to compete if it moves quickly; otherwise it will remain, at best, a minor player in digital advertising.

Twitter too must take swift action to be a credible fourth player although few commentators expect it to develop as a significant threat.

Twitter, in fact, may cease to exist as an independent player as it is unlikely to reach the scale needed to compete at the highest level.

While the market supremacy of Facebook and Google causes considerable concern their predicted and likely future position is of greater anxiety.

Google are well advanced with plans to use artificial intelligence, machine learning and speech recognition in all online digital services to gain greater market share in an already vanquished market.

Facebook, similarly, plans to expand in mobile advertising, video advertising and virtual reality in a way that will drive future online patterns and behaviours.

The respective company actions will maximise the amount of advertising targeted at online customers, which is already reaching saturation point.

Given that online digital advertising is growing and mobile and video usage is expanding at a tremendous rate Facebook and Google are well placed to rule for decades.

So, while Facebook and Google control online digital advertising to a disturbing degree, it is more worrying that they will own a larger percentage of a bigger market in the future.