User Experience Engineering

Friday, December 27, 2013

Google Should Buy Inuit, Crush PayPal

I wrote that Google is Going After PayPal with Google Wallet. What would be Google's natural next step? Google is a few components away from owning the money round trip: POS devices, mobile payment devices, bill presentment, and personal finance. Google could acquire Inuit, get all of those, sell you a mortgage, and prepare your taxes.

Intuit has its own cash-register size POS system and mobile payments device GoPayment. It has announced integration with Square via Square-Quickbooks integration. It has freebie Mint.com, and three paid tiers of the mobile-plus-desktop Quicken 2014.

That big green rectangle in the top left is Google, at $373B
http://www.marketwatch.com/tools/stockresearch/marketmap

Money Required

Intuit would cost less than Ebay, and more than recent Google acquisition Motorola. Square is arguably already on-track for an acquisition, given its recent integration to blood rival Intuit.

$373B - Google Market Cap
$70B - Ebay Market Cap (including PayPal)
$21.8B - Inuit Market Cap
$12.4B - Google acquired Motorola for $40/share
$341M - Square Total Funding

People Have Said So Over Time

I'm far from the first to make this connection. Some have said that it will not happen because of the antitrust precedent set by the Microsoft attempt to acquire Intuit.

Donna Bogatin in March and August 2007.
Andrew Carr in 2007
"...in 1995, Microsoft tried to acquire Intuit, only to be thwarted by the Justice Department's antitrust regulators. (That marked the real beginning of Microsoft's legal woes.) Even though, in the long run, Google could end up an even bigger monopoly than Microsoft, I don't think it would run into antitrust problems if it tried to buy Intuit today. (If it waits, though, all bets are off.)"
http://www.marketingpilgrim.com/2007/03/should-google-buy-intuit-or-freshbooks.html

Time is Ripe in 2013-2014

According to Wikinvest, Microsoft was 6 times larger than Oracle in 1995. It was larger than Adobe, Apple, Sony, Dell, and EMC combined.

Explore more MSFT Data at Wikinvest

Now, it is much more of a group show. If ever there was a time that Google could acquire Intuit, and claim it was not a monopoly, it is now.

Explore more MSFT Data at Wikinvest

Sure, Android OS has 81% marketshare, but most Android is not on a Google/Motorola device. In fact, Google/Motorola are not even ranked in Gartner's latest article on smartphone marketshare. The newest Kindle Fire HDX is an Android device owned by Amazon, and used to promote its content. Apple is the largest corporation of any kind on the Market Map, and takes 56% of the mobile profit. A great argument can be made that Google is avoiding antitrust issues by being everywhere, and sharing its technologies.

The only question remaining is will Google build or buy the parts of its payment flow machine? They could acquire one or more of the Google Apps vendors with related technology. They might be building their own, and choosing to reveal it when the quality is impeccable. They are playing their long game again.

But, the easiest route to owning the cash register is buying Intuit and Square. It's not too late.

Are you a medium-sized business? Intuit has an army of resellers that can hook you up with the "full POS" solution; software, hardware, and integration.