Google's revenue is very closely tied to the amount that people use the web in general. So much so, that they will make more money simply by encouraging people to use the web more. As a result, their strategy is largely to reduce the barriers to the next click and the next session, and thereby moving closer to the next Google search. Faster connections, faster browsers, cheaper devices, more ubiquitous access, etc.

It's almost like oil companies subsidizing the cost of cars to make more money. Reminds me of the start of the Michelin guide book, which was created to encourage people to drive to interesting places in France.

The same can be said of Amazon and their willingness to take losses on hardware just for the chance to get people into their content ecosystem. I've certainly found that, since getting my Kindle, I purchase all of my eBooks (used to pirate), and also use the Amazon store for goods quite frequently, whereas I previously had never used it.

And at this risk of stating the obvious: the Michelin guide then went on to evolve a culture and impact well beyond it's intended use...

I don't think it ended up selling that many tyres but a cost benefit analysis would be interesting. It was a good branding exercise.

... and this means Google has a strong incentive to prevent the public from getting trapped in walled gardens (facebook, iOS, etc).

This a good thing, as it means they're powerful advocates for a more open internet.

I'm not convinced:

The 'open internet' is often just a reverse walled garden. Things used to be locked down on your device, now they are locked down on remote servers where you couldn't even pry them out if you tried hard & ignored the law. (Unless you're the US government, in that case things have gotten much easier.)

The only advantage is that there is no middle-man between you and using any app (website) you want. But no company has ever tried to restrict web access on its devices, so where's the advantage?

And judging Google by its products: Google+ actually seems a lot more closed to me than Facebook (hardly any API?). Android itself is open source, but it is hardly about pushing the open web either. (At least it stopped pushing Flash)

While I don't entirely disagree with your point about the "open internet" being another kind of walled garden, there are definitely companies and organisations that have taken steps to ensure that the open web is actually "open," and Google is one of them. Evidence: https://www.google.com/takeout, which lets you export data from almost all of your Google services.

Some major innovations from Android have inspired sister projects for the open web, like http://webintents.org/

Also, I think you're misinterpreting the term "open internet" ; it usually means "open" for the developer, not the user. However, it's still better for users, as competition between open standards and technologies means that they usually get the best solutions (exceptions being things like h.264) This is certainly better than the classic walled garden where one company gets to decide what developers may or may not use.

In short, it's better because it's: - unfiltered (mature content, etc.) - unrestricted in terms of technologies used - partially open for users

takeout is not the same as interoperability. Google's new products have very weak interoperability (APIs to non-Google clients)

I don't know why people keep complaining that Google+ doesn't have an API https://developers.google.com/+/api/

It is readonly.

It's still an API, but it's incomplete.

Not necessarily, since it seems Google's new strategy is to create its own walled garden and keep you inside of it as much as possible.

I would say they are more like a funnel. And they are trying to make their funnel even bigger. They make their money by sending you to other websites and services, which is why most people don't consider them a walled garden.

Their search engine makes money that way.

Their mail and calendaring apps sure don't, for example.

At this point Google is big enough that generalizing about how they make money is a bit pointless, because they have a bunch of different revenue streams. The only commonality is advertising.

They have the open data policy allowing you to take your data with you. And this is what makes people less suspicious of them.

Sure. They're way better than many about vendor lock-in, because they do realize that it's somewhat evil. Not to mention often counterproductive.

But that's not stopping them from signing deals to get Chrome drive-by installed on users' computers, say. Again, it's a big place. Some of it is still all about "do no evil", while other parts seem to be run by scumbags. Pretty good for a large corporation, all things considered, but not exactly all wonderful.

How so? (genuine question - you don't make it clear what you're referring to)

This business model is not new at all. That's what video games console manufacturers (except Nintendo) have been doing for dozens of years. Selling the hardware very cheap, at no margin or even "dumping it", to make money on the software licenses. Really, Google has not invented anything.

Who's claiming it's new?

What do you mean "except Nintendo"? They nearly invented the practice.

All consoles use the "cheaper razors, more expensive blades" model, but there is a big difference in exactly how.

Nintendo actually prices their gaming consoles above production cost (and probably above all-in cost) AND charges huge license fees to developers (and also has a huge first party developer userbase, unlike the other companies).

Nintendo is the company who maximizes profits, Sony and Microsoft at best maximized top-line and in reality just tried to maximize market share.

> the services that come with it (100GB of free online storage!)

The fine print: "100 GB of free storage is valid for 2 years, starting on the date you redeem the Drive offer."

My first thought was, "I'll just buy a new one every two years."

In two years 100GB or close to it will likely be the free tier anyway. What is the Moore's law graph on Google Storage?

I assumed 1 year when I first read the ad. I get your point, but it still seems like a pretty nice feature.

Aren't these Chromebooks subsidized by Google to get into mainstream faster? I always felt there were big tie-ups. (See Asus Nexus tablet pricing)

And How much is a google user+account worth? An android or a chromebook device is worth atleast $$$+ for Google on the long-run. And users are Locked'in with google's services! And more and more Web users mean more $ flows for google. :)

It must be certain for every subsidized device that ships, Google must be sharing revenues.

Why is $GOOG focusing on PC's when the world is shifting to tablets? Why not put most of your focus on tablets, and make them 10x better?

You may be interested in a little startup called Android that Google bought recently.