A beta version of Google's (NASDAQ:GOOG) newest service, Google Base, is now up and running. You can post virtually anything you want -- job openings, events, cars for sale, the sequence for a DNA strand -- and Google will make it searchable online. It's a gigantic, structured database for the masses that's really only limited to your imagination. As Google puts it, the service will "help the world find your content."
But is that the real intent behind the service? Let's take a closer look at what's going on here.
I tried out Google Base by listing one of my books for sale (no bites so far), and I can say that the process is easy and fast. If you want to make bulk uploads of content, Google allows the use of standard XML formats. A listing expires after 31 days, and the service is free.
Another cool feature is tagging, which allows a user to assign attributes to a listing, such as "dog" or "breed" or "gender," and makes it easier for the user to keep track of listings. Online services such as Flickr.com, which is part of Yahoo! (NASDAQ:YHOO), have successfully used such a feature.
But what's Google trying to accomplish here? The company says Google Base is a way to help fulfill its mission of organizing the world's information. Consider that while Google's programmers have done a tremendous job in developing sophisticated technologies to do so, the system is far from perfect. Googlebot, the company's automated crawling technology, simply does not collect enough information from the Web. The new service enlists users from all over the Web to help in the effort. In other words, Google Base is something of an experiment that allows the global community to help shape the company.
Is Google yet again hiding its real intentions? With Google Base, the company may also be launching an assault on classified ads, even though it has explicitly stated that it has no such intent in mind. But when I went to Google Base for the first time, my thought was to sell something. Google's huge audience of users gives me an easy way to sell my wares.
Will the experiment succeed? "History shows that not all new services introduced by established online players are successful," says Rajesh Navar, the founder and CEO of LiveDeal.com, an online classifieds site. "When Yahoo! launched Yahoo! Auctions in the late 1990s, some questioned whether eBay (NASDAQ:EBAY) could maintain its leadership position in online auctions. eBay's position certainly remains safe today."
But the classifieds category certainly looks ripe for disruption. It is a huge source of cash flow for the newspaper industry, which appears to be resistant to change. "Most classified publishers typically get an upfront fee," says Craig Donato, the CEO of Oodle, which provides a search engine for classified ads. "I believe that the business model for classifieds is shifting to one that is more performance driven. Either way, I wouldn't be surprised if Google acts as a forcing function."
Keep in mind that, according to a recent McKinsey & Co. study, newspapers could lose $4 billion in classified revenue to Internet listings by 2007. The threat is largest in the jobs, cars, and real estate categories, where media analyst company Borrell Associates estimates newspapers generate approximately 70% of their ad revenues.
Ultimately, Google may be targeting the e-commerce sector, especially eBay. By building its listing database and possibly adding payment systems (such as the rumored Google Wallet), Google may be doing much more than organizing the world's information. It may be using its vast global presence to become the tollbooth of the Internet. But if that's the goal, it won't be easy.
eBay is a Motley Fool Stock Advisor recommendation.
Fool contributor Tom Taulli does not own shares of companies mentioned in this article.
