Current revenue increase is because of YouTube's contribution that's finally happening. YouTube had been time bomb in terms of revenue explosion that has been ticking for a long while. YouTube probably generates more views then most popular TV channels but there were hardly any ads until recently. My guess is that YouTube might come close to revenues eventually to web search itself.
It depends what you search for. If you search for something Google can monetize, like this search for sofas
http://i.imgur.com/KAZ6zuq.jpg
then little room is left for "normal" results. But if you search for something non-monetizable, of course less ads will show up.
A page full of blah blah sofas is not very helpful if I'm looking to buy a sofa.
To me it seems actually more useful (and attractive) to show photos, prices and filters in the "Shopping" results seem actually much more attractive and useful, or a map, or some kind of ratings.
On a side note I don't actually get the map results most of the time anymore. Guess I'm in a separate test group.
Google probably has teams full of people figuring out that sort of thing. The problem with maximizing revenue is it annoys people, so if you can figure out how to selectively maximize revenue when it doesn't annoy people...
And I think Google did a good job here as most purchases for heavy items like Sofas will be made locally.
Google (well, I shouldn't pick on google. All brokers of advertising) optimize to push you towards the product that their customers are willing to pay the highest ad rates for.
Of course, In a company concerned with it's long-term reputation, googlers will point out, this is modulated by a knowledge that they need annoy the customer less than any alternative.
My point is that an ad is always going to cause the broker to have a conflict between what the user needs and what the customer is willing to pay for, while an organic search result (unless it competes with an ad, which it often does) does not cause that conflict for the ad broker.
Huh? Advertisers want to make as much money as possible. Consumers want to pay as little as possible for the best goods.
This is a fundamental conflict for a company that has no way to add value for the consumer.
First? google only displays ads from companies that pay them for ads. Next? they order those ads by how much money they can make from those ads.
Do you really think that how much a company is willing to pay to get a consumer to see an ad has anything to do with how good of a deal that product is? If anything, the relationship is going to be inverse. I'll pay you more for a high-margin customer than a low-margin customer.
Oh, and exploit it they will. As expected, a future where "privacy" will become a lot more important, would be the "enemy" of what Google is trying to do, as long as ads are their main source of revenue.
> Lloyd made his pitch, proposing a quantum version of Google’s search engine whereby users could make queries and receive results without Google knowing which questions were asked. The men were intrigued. But after conferring with their business manager the next day, Brin and Page informed Lloyd that his scheme went against their business plan. “They want to know everything about everybody who uses their products and services,” he joked.
http://www.wired.com/wiredscience/2013/10/computers-big-data...
I'm hoping sooner rather than later, Google will find another cash cow, perhaps in self-driving cars, or Google Glass, or Calico or whatever, that will allow them to make a lot of money from that, and not be as desperate about tracking every single thing everyone wants does online, almost as much as the NSA.
Until that happens, we won't be seeing any true secure or private services from Google, because the desire to track will always come first, before anything.
I was at Google from 2006 to 2010, I arrived just after they decided "mini kitchens" (which were amazing collections of snacks and drinks near every bunch of engineers) needed to be reigned in, and left just after the first of the big purges of non-project projects. I was fortunate that since I had worked for Eric Schmidt at Sun we knew each other enough that I felt comfortable asking him pointed questions, like "Uh, seriously? What does changing out the juice supplier (Odwalla) for a cheaper one do for employess?" And he would often answer with insights into Google 'growing up' in many ways the same way Sun did. Much of the fiscal questions were being driven by Patrick Pichette who was the new CFO and trying to get a handle on where all the money was going, and of course in 2009 there was the economic crash and it really drove home the issue of "How much money is 'too much?'" (answer none) and "How much money do we need for the worse case scenario?" (answer all we can get) and questions of "Gee we burn money like gasoline, what would happen if suddenly nobody wanted to advertise on the Internet?" Those kinds of questions lead to a maturation process around money, and making sure that all the money that could be in the bank, was in the bank. Just good business. Challenging to make compelling user experiences though, although Apple had done so.
So long way of saying I don't think that Google is "milking" their customers so much as they are no longer giving quite the value they used to, choosing instead to keep that additional value for themselves.
However Google's search and advertising business (which funds all the rest) has definitely been more focussed on revenue for a while, and Apple has that same feel to me (as a customer and developer) of a company which has peaked and been taken over by those more interested in generating cash than ideas.
Completely understand why you might not agree though.
Could you expand on this? Are you referring to how AdWords content is visually privileged over organic search results?
An interesting experiment is to look at every link on the search results page and try to figure out how many don't generate cash for Google, its getting harder to find more than one, yet when Google was started it only profited from the ad-links.
As others have mentioned search has changed. There is no longer a big push for 'finding things on the web' which was the appeal of early search engines, now the bulk of the web use search as their portal to a giant reference library and product catalog. One of the things Google tried to monetize and failed was reference information (Knol) so now more and more they just show you the fact you were looking for, scraped from some web page, right on their page, no need to click away.
I think it was a smart move on their part from the shareholder perspective (disclosure I sold all my Google stock at $650 :-(). The second order effects though will be interesting. You see if Google becomes just a catalog, sort of like SkyMall "Magazine" in airplane seats, then it risks losing all of its unique utility. I'm certain that Microsoft can construct an equally compelling catalog as can Yahoo. This will shape the future for them.
My search was: jwt web toolkit
The search page itself had no Google ads on it.
The top link was the homepage for the toolkit project. There were no ad links on the page.
The second and third links were for wikipedia, which contained no Google ads.
The fourth link did have Google ads on it. The fifth and sixth lengths did not. The seventh link did.
I tried again with a different set of search terms: neutron spin echo
The top of the page did contain a link to Google Scholar, followed by three links to pay walled articles. I am not aware of any profit agreement between Google and the publishers, but it wouldn't surprise me to learn that it's there.
The remaining links were either to pages containing no advertising (Google or otherwise) or to more pay walled articles. Short of Google have a relationship with the publishers, Google again made no money on this search.
For the record, I don't have an ad-blocker turned on, so I would see ads if they were there.
How about "playstation 4" for example?
Seems pretty reasonable.
I guess the main place where I was unfair to the parent was his comment that not recognizing his comment that:
>There is no longer a big push for 'finding things on the web' which was the appeal of early search engines, now the bulk of the web use search as their portal to a giant reference library and product catalog.
I do use it as a reference library, but almost never as a product catalog. I imagine that, if I used Google to search for things to buy, there would be far more ads, but that forms a negligible part of my internet usage.
A query like "LA Car Rental" will give you an idea of what the parent post describes.
If you want to stick closer to the tech niche, try "build iphone app". Even the query "java profiler" gets me four ads on the page.
Assuming you don't actually want to rent a car in Los Angeles (or maybe if you do), you will get much more entertaining results by adding a little qualification, e.g., "LA Car Rental scams".
On the other hand, Google also provides much more value in search than before. When I travel to a city I can go to Google maps and visualize my destination and find a hotel near by. Navigation is useful, we are perfecting it since thousands of years and Google is really good at it.
As for advertising, it has it's place (like when I'm traveling) and somehow Google got good at showing it to me when I need it.
It's sad that they are the only player to provide this kind of value from a backup perspective, but I don't see a credible alternative to them. And they do contribute back to the community, so I can't even fault them in that respect.
Now maybe there is a point that advertisement is a kind of manipulation and they are brain washing you plus spying on your every move. But if there is one thing I learned it's that nobody cares what you want to say. Algorithms don't frighten me for every day searches (you want to know I search for Ubuntu and Python 3? be my guest!).
I also use add-block and intuitively ignore the highlighted search results in (which sometimes confuses me, as the thing I search is in there). I hate ads for stuff I don't care about or even dislike and add-block is good with that.
Maybe that's why they are so successful, they computed what to show me when I'm looking for it and keep the crap away otherwise..
http://www.ted.com/talks/alessandro_acquisti_why_privacy_mat...
I think the main thing is whether Google can monetize the relevant results, without letting in the irrelevant ones.
I work for an online retailer, and we pretty much show up in all the places we always have, except that now we are paying for more of those spots. Some of our organic search results have fallen off a bit as Google emphasizes larger brand names, but I imagine they'll pick up via their Trusted Stores initiative or whatever the next monetization scheme is.
From the end user side this one is particularly frustrating. Google Shopping has gone from being an incredibly valuable tool when I was looking to make a purchase to being practically worthless. I don't even bother with it anymore.
You can see an article by Danny Sullivan from this summer here: http://searchengineland.com/google-results-too-ad-heavy-1662...
And this is great breakdown of the various types of results Google is providing these days: http://moz.com/blog/mega-serp-a-visual-guide-to-google
I usually go find my laptop.
The shareholders love it because it means Google will finally be pulling in as much cash as they 'can' vs as much as they needed. Users seem to be somewhat divided on the issue.
Sophisticated users and people who are long time observers (like Danny Sullivan) have noted that Google is squeezing the value proposition at the expense of people who can ill afford it. ('Ranking' on Google is very much a pay to play kind of thing these days with their page layout). As others have mentioned they have gone all in as an exploiter of their demographic data. And "thinking big" as Larry would always exhort people to do, includes thinking about how much money you could get for the sorts of things that only someone who has Google's knowledge of the activity stream can get.
Now historically this has often been associated with fading influence and success (the old 'killing the goose that lays the egg' kind of thing). It will be interesting to see if Google is an example of this or they manage to grow into actually being a peer of Apple.