Is adsense more of a service to the webmaster community, or is a mutual relationship bringing google revenue as well?
When did Google ever do anything as a simple "service" to webmasters without lining their own pockets? Look at their approach to the Chinese market -- they willingly crushed Freedom of Speech originating from China in order to enter that market. That's 100% all about the almighty dollar.
Google.com accounts for a huge amount of ad revenue but by allowing pretty much anyone the ability to display ads they've increased their revenue significantly while increasing costs insignificantly which has made them rediculously rich. It's all about them but no company is afraid to give a cut to someone else if it means more money for them overall. See every affiliate program known to mankind.
Adsense=More Places to Display Advertsing on the web=More $$$$$ for Google Does this answer your question? http://www.bloomberg.com/apps/news?pid=10000103&sid=aTfx5lrbCTkM&refer=us Google's Profit Probably Surged Sixfold on Advertising Increase Feb. 1 (Bloomberg) -- Google Inc., the most-used Web search engine, probably will say fourth-quarter profit surged more than sixfold because of advertising price increases and sales of ads the company distributes to Internet sites. Net income likely rose to $175.6 million, according to the average estimate of 16 analysts surveyed by Thomson Financial. Revenue probably doubled to $590 million, after fees that Mountain View, California-based Google pays to Web sites that display its ads. Chief Executive Officer Eric Schmidt is capitalizing on rising demand for online ads by using Google's AdSense program to find new places on the Web for advertising. Google is pushing ads to sites such as the online New York Times, where a story about flamenco dancing is accompanied by a Google ad for flamencosound.com, a music store. ``Google can expand their footprint,'' said Barry Randall, who manages $90 million in assets for U.S. Bancorp Asset Management's First American Technology Fund, including Google shares. ``AdSense offers the company the opportunity to spread its brand name with people willing to do business with them.'' Surging ad revenue and profit have prompted investors to boost Google's share price, which has more than doubled since the company's initial public offering on Aug. 18. That compares with a 7.9 percent gain in the Standard & Poor's 500 Index. The shares may fall when employees and other insiders are allowed to sell an additional 176.8 million shares starting Feb. 14, as the last of its so-called lockup periods expires, said Minneapolis-based Randall, who expects them to continue to climb. That may double the number of shares available for trading. Online Auction Google sells text-based ads using an online auction system, in which advertisers bid the amount they're willing to pay to be displayed alongside results for search keywords. Advertisers pay when users click on the ads. The price of Google's keyword ads increased 20 percent to 25 percent in the past year as demand rose, said Jeff Lanctot, vice president of media at Internet ad agency Avenue A/Razorfish, a unit of Seattle-based Aquantive Inc. Google advertisers paid an average of $1.12 per search for the words ``digital camera'' on Jan. 26, while ``mortgage'' commanded $4.52, according to Lanctot's research. The total worldwide market for ads linked to search results is expected to grow by 45 percent to $8.44 billion this year, according to Anthony Noto, an analyst at Goldman, Sachs & Co. New York-based Noto rates the shares ``outperform.'' Beyond search-linked ads on its own site, Google also places ads on sites including Time Warner Inc.'s America Online and search engine Ask Jeeves Inc. Yahoo Yahoo! Inc., the second most-used search engine, places ads on other sites through its Overture Services Inc. unit. Sunnyvale, California-based Yahoo places ads on sites that include Microsoft Corp.'s MSN and Walt Disney Co.'s ESPN sports channel. Shares of Google rose $5.28 to $195.62 in Nasdaq Stock Market composite trading yesterday. Yahoo has increased 24 percent since Google first sold shares to the public. Fourteen analysts rate Google's shares ``buy,'' 11 say ``hold'' and one recommends ``sell,'' according to data compiled by Bloomberg. Schmidt, 49, declined to be interviewed for this story, company spokesman Steve Langdon said. Schmidt joined Google in March 2001, 2 1/2 years after it was founded by Stanford University graduate students Larry Page, 32, and Sergey Brin, 31. The chief executive earned a salary of $250,000 and a bonus of $301,556 in 2003, according to regulatory filings. He owned 14.8 million Google shares before the company went public and has sold 707,926 shares worth $92.9 million since then, according to data supplied by the Washington Service, a Bethesda, Maryland- based company that tracks sales of stock by company insiders Affiliates Revenue from ads on other sites accounted for 48 percent of Google's sales in the third quarter, an increase from 44 percent a year earlier, according to regulatory filings. Google passed on 79 percent of its so-called affiliate revenue to those sites. Ads on other sites represented 16 percent of company sales after ad- placement fees in the third quarter. About 51 percent of Google's revenue in the third quarter came from advertising on its own site and 1.2 percent came from licensing its search technology to other companies. ``From a bottom line perspective, it's not as significant,'' said Marianne Wolk, an analyst at Susquehanna Financial Group in New York, of Google's ads on affiliate sites. ``But if it brings more advertisers to bid on Google, that's a big plus.'' Google's AdSense software is turning some blogs into businesses, including pvrblog.com, a site run by Matthew Haughey of Portland, Oregon, who writes about digital video recorders like those made by TiVo Inc. Paying the Mortgage ``I don't have to lift a finger and it brings in hundreds of dollars'' each month, said Haughey. He said his site, originally designed to share tips with friends, now pays for his mortgage. Haughey, 32, spends one to two hours a day writing for his blog and said it receives as many as 10,000 visitors each day. When visitors click on Google ads on his site, which are generally for companies selling digital video recorders and software, he receives a share of the revenue. Haughey said he started the project as a writing hobby and would have been glad to make $20 a month.
Think of the adsense environment in terms of owning a television station. By creating more channels (more websites) you've increased the number of commercials (adsense ads) you can sell. In addition, many of the new channels are narrowly focused (HGTV, MTV), which allow your advertisers to target specific audiences. Of course, advertisers love this and they pay more for this targeting. HTH
AdSense is probably, without a doubt, the most profitable department of Google and really is what keeps Google afloat right now...
Google is a company- It has to make revenue to stay in business- The revenue comes from the web. It may have started as "search", but do not doubt it is really a business. And as time goes on the business (revenue) side, is likely to speak louder as they improve "search". It always ends up being the bottom line.
both google ceos are worth over $5 billion i think. also, i believe they recently bought a 747. that being said, i doubt google does many things that knowlingly cause them to loose money.
99% of Google`s revenue is coming from Adwords .... 58% come through the Google sites and 42% come through Adsense http://investor.google.com/releases/2006Q1.html
Do u think it can happen? Google is omnipresent nowadays ... name a service and u'll find Google name along.
It's a revenue model that, when combined with the current search listings algo, pretty much guarantees that adsense and adwords money go in a circle through google continuosly. Evil IMO, but genious! However, the SEC will probably be looking at it soon. I didn't get this idea on my own, bigger fish are trying to bring attention to it.
Let me guess; You heard from a friend of a friend whose brother's daughter's maid know a guy who emptys the trash cans at the SEC?
They aren't even breaking even in some instances. Every penny sold in advertising is a penny for google and a penny to the publisher. The only loser is the one using Adsense for advertising.