Google Says Google Reader Is Doing Just Fine
We reported last week in the aftermath of IAC's decision to shut down Bloglines that Google (NSDQ: GOOG) Reader was not doing that well either, citing the latest Hitwise figures which showed visits to the service down 27 percent year-over-year.
Context & Ripple Effects
Google's denial lands in a market that has been visibly shrinking for months — ReadWriteWeb reported back in December 2009 that the RSS reader market was in disarray and continuing to decline, and IAC's confirmed shutdown of Bloglines removes the most prominent independent player. Bloglines had spent 2008 repositioning itself as a direct challenger to Google Reader before its founder defected to the Google service.
Against that backdrop, the Hitwise numbers showing Reader visits down 27 percent year-over-year gave the decline narrative a concrete data point, which is exactly what Google is disputing. With no syndicated pickup or public discussion recorded, the story's significance rests on the collision between third-party traffic measurement and the platform owner's own account.
First-order effects
- IAC's shutdown leaves Bloglines' user base homeless, creating an immediate migration pool that Google Reader — despite the disputed traffic drop — is best positioned to absorb.
- Google is forced to defend Reader publicly with its own usage account, putting its word directly against Hitwise's measured 27 percent year-over-year decline rather than letting the numbers stand unchallenged.
Second-order effects
- Smaller and independent RSS readers get their best acquisition window in years as displaced Bloglines users shop for alternatives, intensifying competition among the remaining services named in the December 2009 coverage.
- Traffic-measurement firms like Hitwise gain leverage in shaping perception of platform health, forcing large operators like Google to either publish counter-data or accept third-party figures as the record.
Third-order effects
- If the pattern holds, standalone feed readers consolidate around whichever large platform keeps subsidizing them, leaving the category dependent on a single company's willingness to maintain an unpopular-but-strategic product.
- A shrinking reader market pressures the wider RSS ecosystem itself — publishers relying on feeds for distribution face a thinner independent tooling layer as the dedicated-reader category contracts.
The trend: Standalone RSS readers are consolidating and declining, with the category's fate increasingly tied to whether a single dominant platform chooses to keep investing in it.