That’s Huge!

Google announced good but not spectacular Q2 numbers last week (if you can call $14Bn revenue “not spectacular”), and the Wall Street pundits will no doubt gnash their teeth over what could be considered a minor miss. I thought the fact that big G. is spending roughly $3Bn in revenue shares to publishers was fascinating. That’s a number they could so easily increase, and in doing so, drive their top and bottom lines even higher. However, instead of opening the flood gates a little wider and allowing a few more publishers to dine at the top table they remain determinedly focused on keeping as many marbles as they can, which in return limits their ability to grow as fast as the market would like. Truth be told, there is actually a ton of great traffic and revenue out there (including mobile) which Google is not taking advantage of. I completely understand and respect that they hold the quality of the product they offer to their advertisers sacred, but with the extreme checks and balances they have a place to be secure. The purity of the church could allow more in to dine, and greatly increase their own revenues at the same time.

The other striking Google data point is that it now serves roughly 25% of all internet traffic in the U.S. That’s kind of amazing… over 60% of us use at least one Google service every day and they serve more stuff per day than Facebook, Netflix, and Twitter combined. At peak usage (the evening movie spot), Netflix takes up about 30% of the US Internet. However, I guess if we average it all out and add in YouTube, it makes sense that Google does indeed carry that much load. That entire cost is essentially funded by Google Ad revenues, which has been under pressure of late… another good reason why the powers that be, might take another look at letting a few more of us mere mortals dine at the top table.

Leave a Reply

Your email address will not be published. Required fields are marked *