In three months, Google is shutting down Google Domains, selling its assets, and transferring the service’s users to SquareSpace.
Domain Name registration has a straightforward business model. But it is also a commoditized service. There are a lot of registrars, and the service they offer is essentially the same. Once the service is set up, in 90% or more of cases, you only have to deal with the service’s user interface if you change something significant.
For Google, however, Domain Name registration is not a growing market. It was just a convenience for people signing up for Google Workspace and not bringing their own domains. And while some scarce domains cost thousands of dollars, most domains are in the range of $20-30 per year.
I wonder if—or when—will Google decide to shut down the paid Workspace service. While billions of people use Gmail and Google Docs for free, according to ComputerWorld in 2020 Google Workspace had 6 million paying customers, and a 10.3% market share of the productivity software market. Meanwhile, Microsoft’s market share was 89.2%.
Offering Gmail for free makes sense because Google monetizes the service via ads and collects data from its users. But how long will Google stay in a paid market where it cannot show ads to its customers, is not the market leader, and can offer only below-the-market growth numbers? Microsoft has a superior product, 30+ years of experience selling to corporations via its vast network of resellers and integrators, and is integrating OpenAI’s GPT into its office suite.