On the one hand, saying Google Inc is an "advertising company" could be seen as trying to explain some hidden truth. On the other hand if we look at the big picture, applying the label "ad firm" to Google is not that helpful.

Newspapers got the majority of revenue from print ads and classifieds instead of subscriptions. Nevertheless, newspapers were seen in the business of "delivering news". Advertising was the enabler but it wasn't the newspapers' "core competency".

Television networks get most of their revenue from commercials. Nevertheless, they are seen as being in the business of delivering tv shows and movies. Yes, they are also a conduit for advertising but "advertising" isn't what the employees of NBC/ABC/CBS are actually good at.

Yes, in both cases, advertising is the major "revenue" that enables the businesses, but it's not what they actually do. Likewise, saying McDonald's is a "real estate company" can sometimes be an interesting business conversation but on balance, it's still more useful to everyone to say that they're in the business of selling food. They flip burgers much more often than they flip properties.

I think it's best to view Google Inc as a data information company. They are among the top-10 entities in the world to apply algorithms to petabytes of data. At the moment, advertising is a huge enabler of that activity but that shouldn't divert us from understanding what Google thinks they are actually good at.

There's a critical distinction between an advertising agency like Omnicom Inc (that uses technology) vs a tech firm like Google Inc (that uses advertising). Lumping them both together with the meme that "Google is an ad company" doesn't make much sense.

[1]http://en.wikipedia.org/wiki/Omnicom_Group

> McDonald's is a "real estate company"

I actually like the "McDonald's is a software company" lens– the idea being that they have miles of code describing how humans are to interact with one another, how to handle disagreements, how to make french fries– all with staggering precision in detail.

More realistically I guess they're in the business of selling convenient-familiar-cheap-ish-food. The "real estate" elements and "software" elements help to achieve winner-takes-all effects re: convenience and familiarity.

The vast majority of engineers at Google, and the vast majority of code produced at Google is not AdWords/Adsense/DoubleClick/etc related.

Most employees at Newspapers are writers working on stories (journalists), we don't say they are ad companies.

There's a difference between "doing tech" and what Google does that puts them in a whole other category like Microsoft, Apple, IBM, etc. Are you seriously trying to say that most companies "doing tech" are doing the equivalent of Chrome, Android, Gmail, Maps, YouTube, and Search?

This is the kind of negative, pointless comment that the new HN policy warned about. It's regurgitating a meme that has been posted hundreds of times, it's designed to demean and dismiss the good work of thousands of engineers and researchers working on hard problems.

I'm an ex-Googler, and my guess is that > 50% of engineers work on something directly related to advertising. There are just so many projects and systems and moving parts needed to make all that money, it might be easy to underestimate how much engineering effort it takes. And Google management knows very well what it is that makes the company so profitable.

Non-advertising projects get lots of attention, but below the surface is a hulking mass of engineers supporting new ad formats, new ad optimizations, accounting systems, analysis tools, ad targeters, advertiser support front-ends, etc.

Corollary: If you go to work for Google, the odds are that you will be writing code to support advertising.

(I could be wrong--maybe it's less than 50%. But it's a lot, and my guess is that your "vast majority" is a much less educated guess than mine is.)

I don't think so, looking at the org chart for Ads and Commerce.

If you're trying to say someone working on Bigtable, Spanner, or other infrastructure is "direct related to advertising", I disagree. That infrastructure benefits all Google products, not just ads.

If I add up FTEs for Cloud, Search, Maps, Android, Chrome, Apps, Photos, etc is a several times multiple of those reporting to Ads related VPs.

No, I wasn't even including the general infrastructure stuff. I guess my view was warped by working in an ad-centric office.

Is the NYT an advertisement company? No, it isn't. And, furthermore, they have very little in common with, for example, Google. And that's, because Google is a _software_ company, and the NYT is a _newspaper_ publisher. Both sell ads, but that's not what their users buy and it's not what their employees produce. The "advertisement company" classification is just not that useful.

I see your point, but the NYT gets more revenue from subscribers than advertisement.

http://www.businessinsider.com/the-new-york-times-now-gets-m...

Google is an AI company.

Exactly.

Being an AI company is what's pushing them toward the automobile industry. It's easier for Google to get into manufacturing cars than it is for the traditional automobile makers to develop a competency in AI on Google's level.

It's actually not that different than what's been happening with mobile. Google has gotten better at e.g., UI design faster than Apple has been able to replicate Google's competency with the cloud.

The things Google is good at are generally harder problems than the things that they're weaker in. AI is the most important of these.

Isnt it more accurate to categorize a company based on where they get revenue? If so, then Google is mostly an ad company.

But why is Google successful at selling ads? It's because they're best-in-class with AI techniques. Google's revenue is from ads. Google's technology/core competency is AI. Classifying companies is hard, and it doesn't really make sense to try to fit your worldview into "X is Y, A is B". Sometimes X and Y are both A and B.

That makes sense only if you view companies as abstract money generating entities stable over time. In case of Google, it matters more what's their primary competence (information technology) and goals (information technology, solutions to big problems).

Couldn't you say they were a big data company as well? It seems that all that consumer data is what makes them such an effective ad company.

I would say their goal to sort and organize the world's data is right in line with their existence as an AI company. You're not wrong at all that they make tons of money in ads, but then that is also significantly understating the role of communication and Google's role in communication these days.

But the big data is essentially just the knowledge base for the AI.

Yeah, but Google did a huge marketing push that they're an "AI company" recently because that sounds a lot more scifi than the reality that Google's primary revenue stream isn't that different from a company that does cold calls. Marketing isn't exactly appealing to consumers. ;)