Google Acquires Urchin

In other news, Google announced that they acquired Urchin, a web analytics vendor and service. This makes a lot of sense for Google, but not for some of the reasons I’ve seen speculated on.

One speculation is that it gives Google web analytics capabilities to analyze their site. Actually, no, it doesn’t. Google has too much traffic, and their analysis needs are too complex.

Another is that Google can now offer this as an additional capability to their AdWords / AdSense customers. I don’t buy this. Google’s already got enough reporting capabilities in the SEM (search engine marketing) area, and Urchin isn’t going to add any value here that couldn’t have been done cheaper in-house.

It’s also not because Google is just a bunch of Nice People and they want to have another tool in their portfolio of cool stuff.

So if Google doesn’t need this for their own analytics, or to offer to AdWords customers, why bother? After all, Urchin isn’t a game-changing technology. There are better solutions available, no matter which axis you measure on.

Simple. Google did this because they want more ability to get off-network surfing data. They want to know, for people not using any Google services, what are they using? That information is partially available through AdSense, because AdSense lives on third-party sites. That’s a rich source of data. A nice way to get even more off-network data is to supply folks with a hosted analytics service that most small and medium-sized web sites can use. Simply put a web bug / beacon in your page, and we’ll track your visitors for you. And for us.

(Before you get all cynical on me: yes, Overture bought Keylime many years ago, for SEM reporting, and perhaps for off-network information, I don’t know. The difference between the Overture/Keylime and Google/Urchin deals is that Yahoo! and Overture are different legal entities, and have different privacy policies. As a result, Yahoo and Overture cannot share third-party information about web surfers. Whether or not that makes business sense is beside the point – Yahoo’s pretty rabid about privacy.)

One final element of this announcement. If there’s no privacy backlash, and web sites brush off the concept of Google as big brother, the low-end market for web analytics is effectively dead. Omniture, WebSideStory and (perhaps) CoreMetrics will survive, but it’s going to be tough for anyone else, which is going to give the newly independent WebTrends second thoughts about resurrecting WebTrends Live / WebTrends OnDemand.

Google Acquires Urchin

5 thoughts on “Google Acquires Urchin

  1. Brian Mulvaney says:

    Bob,

    I’m not buying the off network surfing data argument. There are a number of places Google can buy copious amounts of off network clickstream data. They don’t need to set up shop as a web analytics ASP for that.

    Brian

    P.S. Good to see you sharing your thoughts.

  2. Interesting perspective. But if Google is really interested in off-network data, why don’t they use their Google toolbar to collect data? (Like Alexa). That would give them visibility into ALL sites – as opposed to getting visibility into only the site which will deploy Urchin.

  3. Brian Mulvaney says:

    They probably do use Google toolbar data. But it’s not truly off-network. Anyone who thinks highly enough of Google to install the toolbar is likely to be a dedicated user.

    If the problem you are trying to solve is visibility into what your users are doing off your properties (which you would mostly get via the toolbar)–or what your potential users are doing instead of visiting your properties–there are quicker, easier and more comprehensive ways of addressing that then building out a web analytics ASP. There are numerous measurement vendors that would love to sell that data to Google. (I know, I tried.) It’s quite possible that Google won’t buy in 3rd party web usage data for cultural reasons.

    One thing that hasn’t really been addressed is what exactly is Google buying? Is it a log file crunching app? A web analytics ASP? An installed base of users? Some smart people in San Diego?

    Most of us in the industry know Urchin as a cheap and cheerful log file cruncher. The company has been working diligently to make themselves more relevant to marketers and to launch an ASP business model. Still, I’ll assert that the amount of PPC money tracked by Urchin today is quite small and the ASP model and architecture is new and unproven.

  4. I’m of the opinion that this offers the small and medium local business an opportunity to have a few great reports on their 2 or 3 page site that will allow them to better understand the impact of online advertising. Having the ability to clearly show value in a $50 or $100 per month local advertising budget online, will drive 10,000’s of local businesses across the US to drop the Yellow Pages ad race and move online. Add to it the Google Maps and additional services like offering domains, and it makes for an interesting thought exercise. I realize this is definitely a different view on the purpose of this acquisition, but the untrackable offline advertising stuck in Yellow Pages and Classifieds are just too big to ignore ($30 – 40 Billion per year?). And, for those of us stuck in the Bay Area commute, it sure seems like I’m hearing a lot more Yellow Pages radio ads where the message is clearly “I get 10 to 20 calls a week that reference my yellow page ad and I know that’s adding $1000’s of business to my company”.

  5. […] asked me for my reaction to the announcement that Google has decided to make Urchin free. I already said it once: A nice way to get even more off-network data is to supply folks with a hosted analytics service […]

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