Google Profit From Crap SERPs

26 comments

Within the industry we have all known the undeniable fact that an established search engine will always earn more from crap organic results than good ones. There is no direct monetisation from someone clicking on an organic SERP, whereas there is a hell of a lot of money to be earnt if a searcher clicks on an Advert. The worse the SERPs the more likely a searcher is to click on a advert, as (truth be told) most of them are pretty relevant.

It may be simplistic but it's still a fact. What Google (and to be fair here, Yahoo, MSN and Ask too) is need to be wary of is when the mainstream media start writing about these facts.

My favourite, El Reg, have a piece about exactly this issue. Google -v- Microsoft and how crap SERPs equate to more share holder income.

The title at The Register says it all.

The worse Google gets, the more money it makes?

Comments

A question of partners

Sad but true, when MFAs and scrapers rule the Serps Google earns from users who are looking for *real* sites (real=ppc content networks payers)...

The publisher networks including AdSense got minimum interest in putting an high barrier for sites to put their media in and the winners are ...

For the short term, yes

Quote:
The worse Google gets, the more money it makes?

Sure, that's true for the short term. But they can't be so bad that people start to look for alternatives. Luckily for Google there's no other engine that has any better results at the moment, with most having much worse.

The people never seem to notice

As long as people don't switch in droves, it makes sense for them to squeeze the SERPS as much as possible for profit. With their stock as high as it is, they need to increase earnings.

One-Third of the U.S. Economy

One third of the monetary worth of the U.S. economy (e.g. its GDP) pours in and out of GOOG stock yearly; that's 2.6 trillion dollars of GOOG volume trades versus the U.S. GDP of 11.75 trillion.

California state officials now estimate that 13% of their entire state revenue came from GOOG insiders selling their stock. Think about that! We're talking billions of dollars in *tax*.

When GOOG falls, so does the state of California and so does much else. This bubble has reached such proportions that by the time GOOG hits $600 it almost becomes *unethical* for some one to point out its flaws and we should just pray that it continues at $600 for 4 or 6 years to let the market prepare for the eventual bust.

Or at the other extreme...How big of a chunk of the U.S. economy does GOOG need flowing in and out of its coffers before its newly-founded lobby group can in effect blackmail the government? Or vice versa?

hopeseekr

Where are you getting those numbers from?

Get real

If 1/3 of the US economy was hinged on Google there would a Secret Service detail on the founders and the military would be guarding the place.

The amount of money pouring in and out of a particular stock is a meaningless number as many people like myself could (and do) buy and sell the same stock over and over again as it goes up and down and it's the same money. Saying I spent $100K on a specific stock this year would be silly when in reality I bought it 10 times for $10K each time, and just skimmed off $1K profits each time, as this is a HUGE difference in perception of transactional cash flow vs cash in hand.

It's like the casino telling me I bet $20K in 3 hours at a $1 slot machine when I only spent $300 in actual cash, get the point?

13% of CA taxes?

Where did you hear this?

The article I read says:

California took in a record $11.3 billion in personal income tax receipts in April, $4.3 billion more than it collected last April. It's almost certain that a significant chunk of April's haul came from Google employees -- perhaps one-eighth or more of the tax receipt gain.

Let's start with 13% of $11.3B which is $1.46B and a far cry more than about 1/8 of the $4.3B increase which is only $0.53B

google

could collapse tomorrow and everything would be OK.

its not an essential/strategic service.

Those guys in California

Those guys in California sold their shares right? That means they are holding cash now. Not shares. No worries.

Oh yeah?

could collapse tomorrow and everything would be OK.

A large segment of the internet businesses that depend on Google referrals would go along with it, not to mention all the sites that depend on AdSense suddenly out of business.

The impact would be like a financiel asteroid hitting the net, the crater would be stunning, definitely an extinction event.

deja vu

yeah just like last year, and the year before that, and back in '03.... no big deal.

Not to mention

Not to mention no tax increases for the state of California, 70 billion dollars wiped off the books (if stock goes to $200), and far more in stock option speculation.

The question then becomes: how does morale stay up in a company where people's 4 years of bonuses is irrevocably tied to the belief that the stock will always rise? If you used your GSUs as leverage for a loan, imagine your state of mind when you see your GSUs devalue by 1/2. Would you truly be a productive employee? Or attempt to cash out now by tendering your resignation?

Schdmit, Page and Brin took the later option already.

>> A large segment of the

>> A large segment of the internet businesses that depend on Google referrals would go along with it,

So, Google users would actually disconnect from the Internet then? Not switch to Yahoo?

The businesses that went bust would deserve it. If your business depends for surival on a single supplier, with whom you have no contractual relationship, you are alreday fucked. That would just be the shoe dropping

You miss the point

So, Google users would actually disconnect from the Internet then? Not switch to Yahoo?

Would You Like To Play A Game, Professor Falken?

Let's play Google Gone - wake up tomorrow morning, Google is simply gone, no warning, poof.

It would be be a huge disruption in service, there would be lot of people with lost deferred income, YPN couldn't handle the inbound flood, hell, they aren't even running a global product yet, MSN AdCenter is barely up and running, people looking for solutions would be waiting and waiting...

Imagine all the sites that get 100% of their traffic from Google?

OOOPSIE! >POOF!<

Some of my old ecommerce customers would be in a world of pain as they get 70% (or more) of their traffic from Google, many like them in the same boat, maybe Yahoo would pick up the slack, maybe it wouldn't. Maybe their competitors are on top in Yahoo and it would be a massive income shift from one company to another now getting all that traffic, not a pretty picture.

Trust me, if it happened tomorrow, it would hit the fan, people would be in a panic, the other contenders would be overloaded as I'm suspecting neither Yahoo or MSN could even handle the overflow search traffic in the short term, the stocks for that sector would go wonky, it would be amusing to say the least.

However, let's say Google died a natural death, stock had been plunging, it was at the end of it's life cycle, people had already made contingency plans watching it decline, it would most likely be an orderly process with very little repercussion, but that certainly isn't the situation today.

My sites are safe as I never put all my eggs in one search basket, and a substantial amount of traffic is from a network of sites via links, how are yours?

google gone

tomorrow.

No big deal, customers still buying just coming from different engines, as far as G$ centric biz models, those upheavals happen all the time, it would be a bit more extreme than a major update/refactoring but not by much.

Google already has instability for web properties built into its operation.

Bigger deal than you think

I think you underestimate the turmoil caused when the monopoly leader simply goes away without notice. The alternate players DO NOT have the capacity to handle that sudden influx of traffic, not on any level.

Here's a good analogy, it would be similar to what happens when California has a major earthquake. Even though all the phone systems are typically fully operational they aren't designed for EVERYONE to be online at the same time and it takes days before the "all circuits busy" problem goes away. That's what I think would happen to Yahoo.

There would be a few shaky days or weeks before most things were back to a reasonable resemblance of normal.

so what...

instability breeds irrational behavior AND opportunity.

if google were gone ...

there would be a whole lot less time wasted scrounging through crap serps for the information being researched.

Riiiiiiiiight

Like the others don't serve up crap too, Google just has a better bowl of crap

No not really

>>Google just has a better bowl of crap

er no it has a larger pile of it

Simple ripple effect

Google goes so people switch to search on Yahoo and MSN, if they can't cope people will try Ask and Alta Vista, then they may go to the meta engines, then perhaps the directory sites will have a boost. Then the dust will settle and either a new player or the remaining big 2 will capitalise and become the market leader.

Sure people will get annoyed at not being able to 'google' for something, sure there may be a lot of 404 pages and certainly a lot of business based on very bad business models will go bust - but in the end, the smart companies would do well and normallity will resume.

searching skills

So who here really and truly can't find what they're looking for when they use Google? It really doesn't seem to be a problem in the least, and if it is for you, perhaps you need to brush up on your searching skills?

It really doesn't seem to be

It really doesn't seem to be a problem in the least, and if it is for you, perhaps you need to brush up on your searching skills?

I have seen many sites filtered out of Google for their official site names.

meta engines

Um dude, the meta engines require that the regular SEs aren't overloaded and most will be hanging waiting for a reply from Google the day it goes KA-POW!

Also, Alta Vista is powered by Inktomi, don't know how they have that all set up but AV/Yahoo probably share resources.

Sure, in the end everything will adjust, but there would be some real tense moments.

Not to mention, you wouldn't be able to watch the NEWS for months until they stopped yapping about it.

It really doesn't seem to be a problem in the least

After wading thru 500 affiliate and scraper results I tend to forget what I was looking for in the first place, so you're right, not a problem.

Google solved the canonicalization problem

they simply removed the root.

it's always a trade off

Google needs to preserve it's "no evil" image among the general audience and also try to make the most $$ of their traffic, exactly as some of us do ;)

Google needs to be one step ahead the other search engines, but it's just one step, which still leaves a lot of space ..

/qwer

meta engines

Um dude, the meta engines require that the regular SEs aren't overloaded and most will be hanging waiting for a reply from Google the day it goes KA-POW!

I am sure they will just turn off the call to Google, then Yahoo / MSN as they fall...

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