What they should have done is announced that they were killing it, then when the entirely predictable public outcry hit, 'listen to the community', and make it a paid service instead. From the numbers Feedly and Newsblur and such are picking up, it doesn't seem like a stretch that a paid version of Google Reader could have brought in at least $10M/year, even given the resulting loss of users. The only difficulty would be converting from free to paid without massive backlash. The bait and switch would accomplish that.
Hire a few full-time engineers to maintain it, and you've still got many millions of dollars in annual revenue for something that already exists. Surely even a company Google's size would be better off not throwing that away in the interest of 'focus'. But hey, Larry is clearly smarter than I am, so presumably he knows what he's doing.
Heck, maybe he even realized that Reader had become an impediment to progress and removing it would be a net good (pun intended). The progress that's been made in just the past few months is certainly exciting.
You're talking about a company with $50B revenues; $10M isn't even pocket change.
Running a "service on the side" doesn't just cause "focus" problems for senior management. It creates legal, technical, and reputation risks which far outweigh the few million bucks of profit Google might make.
I think the real cause is they don't want to promote a different platform (i m thinkin g+) as the mainstream source of content stream, and supporting RSS as a protocol is only going to dilute that goal. Even if they were making a profit on reader, they would still kill it (unless it's fuck-you profit, which it certainly isn't).
I don't agree with their goal, but since i m not a google customer, and i don't pay them money, i don't get to decide their goal.
Ha, ya, I just said the same thing in reply to piqufoh regarding pocket change. The technical and focus issues I think could easily be handled by hiring a few people and having them 100% dedicated to Reader. $10M should be more than enough for that. You'd still be talking about revenue per employee of at least a couple million. (Google as a whole, with ~$50B revenue and ~50k employees averages about $1M revenue per employee.)
The potential legal and especially reputation issues I hadn't considered though. If they're trying not only for internal, but also external focus - essentially shaping how people think of the company, which seems obvious now that you mention it - I could see how they would consider 'niche' products like Reader detrimental even if they do make good money.
Taking a pure business centric view - We're not google's customers, advertisers are. If we paid for the service we would expect no advertising - and so google's customers would lose.
Maybe, but Google have plenty of tactical products which only have an indirect at best business model. Reader shutdown seems more a case of management vision. Under Page's reorg there are now 5 consumer facing units:
Most natural fit would be 1) or 2), but evidently neither Knowledge or Social wanted to pick it up. That leaves 3) as the remaining possibility through a merger with Currents, but that units already spreading itself thin.
In the end I think they really wanted to recapture the server cycles since even at Google's scale caching every single feed and creating a searchable index for each user is expensive (for this reason none of the online replacements are able to offer search so far).
They probably saw Reader as taking too many resources for its relative impact, and we know from the former product teams comments that even while work on it was still active the upper management was was never really all that effused about it at the time. Page's views didn't change after he took over so it was really just a question of when not why.
If Google was already making that kind of money purely from ads Reader, then the rest of my reasoning stands. Just hire a handful of engineers to maintain it full time and enjoy raking in millions of dollars a year for many years.
The fact that they shut it down suggests that it wasn't making millions of dollars from ads, so why not remove them and charge for it instead? As I said, the only real barrier would appear to be the reaction, which could be solved with a bit of manipulation, in fact spinning it into a PR positive.
I suspect the answer is that a few millions dollars a year is considered pocket change by Google, insufficient to waste time on. To me that reasoning seems shortsighted. Again though, it's likely that Larry Page's sight is in fact much longer than mine.
I think a lot of people would have refused to pay out of principle; it's basically a hostage negotiation. "Give us $10, and you can keep Google Reader."
That's why you need to get the users to ask you to charge for it. Say, "Sorry, we have to shut down Google Reader because it's drawing needed resources from our other projects," or whatever. Then when people say, "NO! Please, just charge for it! I'd be happy to pay $20 per year for Reader!" you benevolently listen to the community and agree to transition to a paid service instead of shutting it down.
Hire a few full-time engineers to maintain it, and you've still got many millions of dollars in annual revenue for something that already exists. Surely even a company Google's size would be better off not throwing that away in the interest of 'focus'. But hey, Larry is clearly smarter than I am, so presumably he knows what he's doing.
Heck, maybe he even realized that Reader had become an impediment to progress and removing it would be a net good (pun intended). The progress that's been made in just the past few months is certainly exciting.