Much has been written about Google's decision to cancel Google Reader, their RSS feed reader. This decision troubled me for several reasons, not the least of which was that I had been using this free product for several years. However, something else troubled me about this as a strategic decision by Google but I could not figure out what it was. This morning Fast Company provided the answer in an article "The Danger of Free Google Software".
Google is one of the best examples of what Clayton Christensen calls disruptive innovation. Christensen correctly argues that a more limited feature set product at a lower price point can disrupt an incumbent market leader. For example, Gmail disrupted Microsoft Outlook. The power of Google's disruption strategy is in part that they have lowered the price to zero or free.
Google has used the same strategy with the new Google Drive, which is their competing product for online storage and backup. A certain amount of storage for free, which is perhaps a better price than market leader Dropbox, might encourage people to leave Dropbox...until now. Who wants to backup their whole life on Google Drive and in 3-5 years find out that Google is canceling the product like they did Google Reader.
For Google to make a decision that potentially undermines their whole disruptive innovation strategy strikes me as a very poor decision. No matter how bad the profitability of Google Reader, such a prominent product should not be cancelled when it it risks customer confidence in Google's other free products.