New Venture Lab: Equipping Christian Entrepreneurs

Comment: Excellent analysis...

Let social media mavens debate whether Google will succeed as a 'Facebook killer' where Buzz did not. I think they'd benefit from a quick look back at a failed innovation Google quietly DNR'ed. It offers a sobering reality check for anyone who believes that great people, great skills, great wealth, a great brand, and a great opportunity invariably lead to great innovation, They don't. Not even for Google. There's a valuable lesson here.

Google Health should have become yet another of the super search engine's high-impact, paradigm-busting successes. All the essential ingredients were there. A huge global market consistent with Google's espoused mission to 'organize the world's information.' An increasingly info-centric industry rife with inefficiencies achingly ripe for transformation. The chance to bring algorithmic ingenuity, superior scalability, and simpler user interfaces to individuals and institutions overburdened with complication. No dominant incumbents but intense interest from serious rivals such as Microsoft to spur competitive creativity. A controversial and humongous health care reform initiative in America to promote top-of-mind awareness and concern. Literally hundreds of billions of dollars of opportunity.

Rarely do the post-industrial stars align so well for an entrepreneurial enterprise hellbent on market revolution. Between the ongoing digitalization, consumerization, and personalization of health care delivery, Google was supremely well-positioned to have as big an innovative impact on medical informatics as it's had on mass media. Admittedly, Google Health's original conception and execution as a 'personal health records' portal wasn't particularly sexy or exciting. But then, that's what many naysayers had said about search and maps. Google had the skills and resources to iterate its way greater impact. Everyone understood that organizing the world's health care information was a worthy business ambition squarely in Google's innovation sweet spot.

The market reality proved sour. Nothing much happened. Barely three years after the service launched, Google announced its demise. Health officially dies in January; all whimper, no bang. By virtually every metric that matters, it's been a stunning disappointment. The service may not have lost Google much money but, relative to opportunities and expectations, Google Health transformed nothing. No paradigms were nicked or even nudged. Genuinely talented people with top management support and technological brilliance don't even have the satisfaction of a successful failure. (Google Wave, for example, may have been a market failure but even its critics acknowledged its innovation chops.) One of the world's most innovative companies didn't just fail to innovate as a business, it dramatically underachieved even as a technical innovator in one of the world's biggest, most dynamic, and most important industries. What happened?

Some observers say that regulatory and privacy concerburns deterred participation. Google insiders point out that an internal champion left the company to launch a digital healthcare company of his own. External critics complain Health's initial user interface was clunky and that the burden of inputting personal health care data was a discouraging bore. Even more damning are accusations that Google Health's 'records management' value propositions simply weren't compelling enough to command commitment from either health care organizations or individuals. An upgrade last year didn't meaningfully shift momentum.

No doubt each of these points have elements of truth. But none of these reasons comes close to explaining 'the why.' Here are mine:

Google Health failed both as a business and as a product because Google ignored — rather than embedded — the innovation sensibility that made it successful. Google Health failed because it wasn't designed to deliver the fundamental value proposition that Google has done best. Google Health failed because it betrayed the very Web 2.0 ideals that made it both a technology and market leader. Access to great talent, great tools, great technology and great markets collectively couldn't compensate for Google abandoning its computational core competence

"A true Web 2.0 application is one that gets better the more people use it," noted internet infopreneur and publisher Tim O'Reilly, whose team coined the phrase 'Web 2.0' over five years ago. "Google gets smarter every time someone makes a link on the web. Google gets smarter every time someone makes a search. It gets smarter every time someone clicks on an ad. And it immediately acts on that information to improve the experience for everyone else. It's for this reason I argue that the real heart of Web 2.0 is harnessing collective intelligence."

Simply put, Google Health was never a true Web 2.0 application. Google Health didn't get better the more people used it. Google didn't get smarter every time someone made a link or search. Google certainly didn't 'immediately act on that information' to improve the Google Health user experiences. The real heart of Google Health certainly wasn't a harnessing or harvesting of 'collective intelligence.'

Contrast that with the ongoing success of Google Maps and Gmail. For an even more compelling case, look at how Android — formally launched after Google Health — and its Open Handset Alliance evolved. Android was a true Web 2.0 innovation platform in every way Health was not; Android enabled a true Web 2.0 innovation ecosystem in every way Health did not. Android was predicated on empowering Web 2.0 user experiences in almost every way Health did not. Indeed, where were the Aetnas, Kaiser Permanentes, and British National Health Services in adding ongoing value to the Google Health experience?

Web 2.0 innovation isn't just about who uses the application, it's about who is trying to make it better. Because Android truly embraced and embedded the Web 2.0 ethos, Google was able to do for handset manufacturers what it proved unable to do for health care companies. Google Health never became an innovation ecosystem where users, usage and partnerships combined to continuously create new value. It didn't have the Web 2.0 heart for it.

But the very reasons for Health's failure help explain why Google deserves all the attention it's been getting. Social media platforms like Facebook can't succeed unless they, too, honor the commandment to creatively harness collective intelligence. Google's renewed efforts to compete with Facebook force it to revisit its most fundamental Web 2.0 innovation sensibilities. Google's future health depends on learning the right lessons from Google Health.