Google Alliances with other Companies - Coursework Example

Google Alliances with other Companies Google Alliances with other Companies Alliance can be defined as coming together of two or more firms (merging) in order to fulfil an economic activity and make profit. In global world, alliance between firms has become very easy and profitable and so more and more companies are merging to create a product or service and claim a stake in the market (Nevin, 2014). The example of Google is also similar. In recent years, Google has formed a number of alliances with foreign and local companies. Some of the popular alliances include the one it made with Samsung and a group of automobile companies, which has come to be known as open automotive alliance. This paper will critically assess the rationale behind the mergers that Google made with other companies. Nonaka (2005) describes a type of alliance known as knowledge based theory of alliance. This type of alliance binds two or more companies together so that they can take and share information with the companies they have formed an alliance with. The advantage of this type of a strategic alliance is that all the companies involved get to work with each other and the different markets they have entered in. They get all the information about the market they might be entering independently in the future. The example of Samsung and Google is just the example of a knowledge-based theory of alliance. Google made alliance with Samsung so that it could gather information about the market, which Apple entered one year before them. The purpose of Google to form an alliance with Samsung was to enter a market that was widely open with only a single player operating from before. Google’s alliance with Samsung was a response to the operating system introduced by Apple known as IOS. Google saw that there was a great potential in a market that was bound to grow as the demand for the new Apple smart phones, introduced in 2007, exceeded the supply (Hitt, 2014). Google formed an alliance with Samsung as it did not have any experience in making cell phones and needed a platform to launch their operating system, which they named it android. Samsung gave Google that platform to try and test their operating system against the operating system designed by Apple. The move made by Google seemed very logical as it allowed tem forming an alliance with a brand that already existed in the market (Roberts, 2014). Moreover, Samsung was a very popular brand and one of the few that could compete with Apple because of their finances and brand name. Google had access to all the information about the smart phone market. By making an alliance with Samsung, Google had all the information not only about Samsung but also the other companies that Samsung was competing with. When Google entered the smart phone industry with its operating system its aim was not only to provide an operating system for different platforms but also to run a separate smart phone company. It wanted to incorporate what Apple did. Google wanted to make a unique device where its operating system could be fully utilized (Roebuck, 2011). Since the launch of its operating system, Google started working to construct that unique device that could supplement its operating system. Since 2008, Google has been planning to make Google glasses, a pair of glasses that could be used as a phone for making and receiving calls, make videos, listen to music, use internet and possibly do everything that a smart phone does. Google utilizes and accesses all the information it gets from the smart phone market. If Google had not made an alliance with Samsung then it could not have had the privilege to get this first hand information (Roebuck, 2011). The knowledge based theory alliance that Google has followed has been very beneficial for the company. It has not only been profitable over the years as more companies including LG and HTC have become a part of the android operating system circle but it has managed to fulfil their aim with which they came in the market. It is not yet fully known when Google will launch its Google glasses but the company has claimed that its alliance with Samsung has only helped them improve their platform (Wedam, 2014). The alliance of Google with General Motors, Audi, Honda and Hyundai is known as Open Automotive Alliance. This type of alliance can be defined in the realm of strategic business as a joint penetration alliance. This type of an alliance allows a company to form collaboration with another company where one or more companies look to assist each other and provide a new service to the consumer that helps them penetrate the market (Czinkota & Ronkainen, 2012). When Google came in alliance with these companies they wanted to create a system where they could extend their operations of android and take a lead from Apple and other companies providing computer technology. Extending android systems in cars enabled them to lead the automobile market, just like IOS did in the smart phones market. So far Google has incorporated Google earth in cars like Audi and Honda where customers, within a specific range, can help to communicate with the car and effortlessly reach their destination (Karch, 2010). Joint penetration alliance like the Open Automotive Alliance has been very beneficial for Google. One of the reasons is that it is now linked with renowned automobile companies like Audi, Honda and Hyundai. Audi and Honda make some of the most technologically advanced cars and Google has greatly benefited from this alliance. Google will be known for providing the latest automotive technology with these cars (Nudelman, 2013). Google also gets to take over the market as these companies have a very solid reputation. If Google delivers what it has promised its customers then more companies will be interested in integrating a system similar into their cars. Google Earth is just the beginning and the right step towards a better future for android in the automobile industry. The Open Automotive Alliance was formed with the goal for providing customers of these automobile industries with the most efficient technology that was not introduced in the market. Google is working on projects that could give them the advantage of integrating smart phones in the car. Although the technology to operate cell phones from car already exists in market but what Google is trying to do is something different (Nudelman, 2013). The new Audi models come with a special screen that would enable customers of to read and respond to messages through screen. The entire system will be voice operated and there will be buttons attached to the steering just to receive and end calls and also to get back to the main menu. The smart phone inside of a car would not have to be functioned with the use of hands. This type of technology has not been invented so fat and Google is tying its level best to implement it by 2015. Apple has only thought about installing the system but has made no concrete steps so far. It has not contacted any company so far and has no contract in place (Nudelman, 2013). With this technology Google expects to beat competition off from major rivals like Apple. One more advantage that a joint penetration alliance gives is that it helps to establish companies together and binds a unique association. If Google is linked with Audi, Honda and Hyundai then these companies become inseparable from each other. If Google’s automotive technology becomes a hit then these major companies would make a long-term agreement with them. Customers would like to see Google automotive technology in their cars as they would get used to the style of technology. The automotive companies would not be able to satisfy their customers in the near future if they fail to integrate Google technology (Bray, 2014). It is true especially after seeing how successful Google Earth has become among customers. People are getting used to the system that is brought to them as a result of an alliance between Google and these automotive companies. Average customers, especially the elderly prefer Google talk as many of them have stated that it has made their travelling life much easier (Bray, 2014). The alliance of Google with Samsung makes complete sense when it happened. Google needed a platform to launch its operating system and coming in alliance with Samsung gave them that opportunity. Samsung was one of the strongest brands in the cell phone industry and Google got a platform where success could come quick if only their operating system could match that of their rivals. Google was able to provide a completely new experience and some of the features in their operating system like user customization was not even available in IOS. Moreover, as a result of their successful alliance with Samsung they also managed to launch their operating system through other platforms. The alliance of Google with the automotive industry was different. With Samsung they wanted to find a platform to enter the market that was not yet penetrated. Google wanted to establish them in a market that was not yet penetrated. Apple has not made any efforts in integrating a system that could make the use of Smartphones inside a car. With this technique Google has entered a completely new market to explore its operating system. List of References Bray, H., 2014. You Are Here: From the Compass to GPS. 4th ed. New York: Basic Books. Czinkota, M. & Ronkainen, I., 2012. International Marketing. 3rd ed. Belmont: Cengage Learning. Hitt, M., 2014. Strategic Management: Concepts and Cases: Competitiveness and Globalization. 4th ed. Mason: Cengage Learning. Karch, M., 2010. Android for Work: Productivity for Professionals. 5th ed. New York: Apress Publishers. Nevin, M., 2014. The Strategic Alliance Handbook: A Practitioners Guide to Business-to-Business. 2nd ed. London: Gower Publishing. Nonaka, I., 2005. Knowledge Management: Critical Perspectives on Business and Management. 2nd ed. Abingdon: Routledge. Nudelman, G., 2013. Android Design Patterns: Interaction Design Solutions for Developers. 2nd ed. Indianapolis: John Wiley & Sons. Roberts, J.R., 2014. Mobile Tech Report 2014: Technology news from 2013 and predictions. 3rd ed. London: Mindwarm Incorporated. Roebuck, K., 2011. Android: High-Impact Strategies - What You Need to Know: Definitions, Adoptions, Impact, Benefits, Maturity, Vendors. 3rd ed. New York: Emereo Pty Limited. Wedam, J.M., 2014. Google Glass Can Read Your Mind. 3rd ed. Belmont: Createspace Independent Pub. Read More