Google’s Getting Ready to Dominate Your Car As Well

A look at how Google can cash in as automakers build more and more connectivity into our cars.

Feb 9, 2014 at 8:35PM

Google (NASDAQ:GOOGL) made big news at the recent International CES in Las Vegas with the announcement of the Open Automotive Alliance. As its website says, the OAA "is a global alliance of technology and auto industry leaders committed to bringing the Android platform to cars starting in 2014."

So, Google has that going for it, which is nice. But the company also stands to win big as location-based technology becomes more and more ingrained not only in our mobile devices, but in our cars as well as automakers build 4G connectivity right into our vehicles.

Motley Fool analysts Austin Smith and Rex Moore were at CES, and discuss Google's automotive possibilities in this video.

A full transcript follows the video.

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Rex Moore: We mentioned this is Google's thing. What about them? They're in everything. Still, obviously over 90% of their revenue is advertising based, but what do they get out of this?

Austin Smith: When you look at Google, one of the best products to come out of the Google brainchild in the last years has to be Google Maps; it's ubiquitous, it's integrated into cars now.

Just on one quick first blush, you start to see how a product like that is even further strengthened when you can have real-time data, not just second-guessed from mobile devices in cars, but actually from the cars themselves.

I see location-based services like Google Maps becoming significantly strengthened. You can start to actually integrate traffic patterns into fuel efficiency and better commute times; just all-around better data, further entrenching what is already a very entrenched product. Anything that involves location and tying it back with advertising is going to be a huge win for Google.

We had a really interesting conversation with someone earlier, where a lot of Google's value for companies, in many instances can be squishy. I search for a Coach (NYSE:COH) bag, but if I don't buy it online, it's hard for me to know that that search actually was meaningful.

What becomes very interesting is, if you start having all this location-based technology, you can start to see that somebody searched for a Coach product, and within the next six hours got in their car and went to the Coach store. When you have this location-based technology, you can make that advertising connection a lot stronger.

You can start to see the value add from Google becoming much more direct. Not only do we know people searched for this, but they actually went out and bought it six months later. You can start to see some CPM numbers going up when you can make a very strong connection like that.

Anything that strengthens Google's presence and awareness and knowledge about your location, as well as the sort of ads you're being served -- and when they can star to tie those together -- you're talking about an advertising behemoth, even bigger than they are now. An incredible world is going to open up to them.

Austin Smith owns shares of Coach and Google. Rex Moore owns shares of Google. The Motley Fool recommends Coach and Google. The Motley Fool owns shares of Coach and Google. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

4 in 5 Americans Are Ignoring Buffett's Warning

Don't be one of them.

Jun 12, 2015 at 5:01PM

Admitting fear is difficult.

So you can imagine how shocked I was to find out Warren Buffett recently told a select number of investors about the cutting-edge technology that's keeping him awake at night.

This past May, The Motley Fool sent 8 of its best stock analysts to Omaha, Nebraska to attend the Berkshire Hathaway annual shareholder meeting. CEO Warren Buffett and Vice Chairman Charlie Munger fielded questions for nearly 6 hours.
The catch was: Attendees weren't allowed to record any of it. No audio. No video. 

Our team of analysts wrote down every single word Buffett and Munger uttered. Over 16,000 words. But only two words stood out to me as I read the detailed transcript of the event: "Real threat."

That's how Buffett responded when asked about this emerging market that is already expected to be worth more than $2 trillion in the U.S. alone. Google has already put some of its best engineers behind the technology powering this trend. 

The amazing thing is, while Buffett may be nervous, the rest of us can invest in this new industry BEFORE the old money realizes what hit them.

KPMG advises we're "on the cusp of revolutionary change" coming much "sooner than you think."

Even one legendary MIT professor had to recant his position that the technology was "beyond the capability of computer science." (He recently confessed to The Wall Street Journal that he's now a believer and amazed "how quickly this technology caught on.")

Yet according to one J.D. Power and Associates survey, only 1 in 5 Americans are even interested in this technology, much less ready to invest in it. Needless to say, you haven't missed your window of opportunity. 

Think about how many amazing technologies you've watched soar to new heights while you kick yourself thinking, "I knew about that technology before everyone was talking about it, but I just sat on my hands." 

Don't let that happen again. This time, it should be your family telling you, "I can't believe you knew about and invested in that technology so early on."

That's why I hope you take just a few minutes to access the exclusive research our team of analysts has put together on this industry and the one stock positioned to capitalize on this major shift.

Click here to learn about this incredible technology before Buffett stops being scared and starts buying!

David Hanson owns shares of Berkshire Hathaway and American Express. The Motley Fool recommends and owns shares of Berkshire Hathaway, Google, and Coca-Cola.We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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