How Does Google Make Money V2
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Transcript of How Does Google Make Money V2
How Does Make Money ?
Prateek Gera
Advertising is the key source of revenue for Google today
Source: Google 10-K Filing , Feb 2010
Advertising on Gaurav’s YouTube channel earns revenue for him and Google.
Google search enables two advertising revenue streams
Advertising on Google’s websites, e.g. google.com gmail.com orkut.com
Advertising on pages of Web Publishers, e.g. travelblog.org techcrunch.com
Ad Words and Ad Sense are the primary engines for the Advertising revenue
Advertisers/ Business Owners
Web/ Content Publishers
Ad Words Ad Sense
Advertisers use “Ad Words” to bid on keywords
Content publishers use “Ad Sense” to become Google network members and earn revenue
$
$
Advantage to users Free services (search, information, email, maps, etc.) Useful, relevant , non-invasive advertisements. Great online experience.
There are two key trends that hold the potential of becoming big revenue drivers in the near future
Convergence of Cell Phone & PC
> 100,000 Android Phones activated every day
Pervasive Internet
> by 2011 5x> non –PC devices *IDC
Google TV
Source: JPMorgan: AdStats Oct
TV advertising is $150bn
TAM
Competition in core search driven advertising is growing but these will generate $2.38bn in 2010*
• YouTube• Double Click• Mobile Internet Advertising• Google Apps• Mobile Hardware
* Source Caris & Company Estimates