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Is It 1999? Google CEO Claims More Competition Leads To Higher Prices
from the economics-overturned dept
One of the telltale signs of bubblethink is when people become convinced that some basic rules of economics and business have been completely overturned. Judging from some comments at Google's analyst day, CEO Eric Schmidt seems to have taken a big sip of from a stale vat of "new economy" Kool-Aid as he claimed that competition from Microsoft and Yahoo in the advertising business could actually drive keyword prices up. The only way the price of keywords can go up is if they deliver more value per click (a greater likelihood of a click turning into a sale), or there is an increase in bidders all desperate for internet traffic. Most likely, the new entrants probably won't have much of an effect on them, since neither of the aforementioned factors are affected. That being said, Google may be forced to give publishers a greater share of Adsense revenue to prevent defections to competing products. The statement on keywords wasn't the only strange thing that Schmidt said. He claimed the company has a "limitless growth model" and that, "If this all comes together it will work as a continuous cycle". Though all this talk sounds eerily familiar, one thing has changed. The exponential hockey stick charts of yore have been rotated 90 degrees; they've been replaced with constant talk about the long tail.
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Give this man a job at the Post Office
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What's google? Is it like a new myspace thing or
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Re: What's google? Is it like a new myspace thing
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I might as well tell you what it is
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Dumba**es
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DISCLAIMER: Google bias
Leaving out this comment might lead to your interpretation, but when you factor in the KEYWORD --->auction
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boo this comment system stripping my comments
Anyway, he's talking about auctions. If theres more parties interested in the auctions for keywords, higher prices will result. These higher prices will mean more revenue, because a keyword doesn't cost google any more than it did before.
The article should NOT have reiterated his more revenue comment without the auction bit.
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Re: boo this comment system stripping my comments
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Re: boo this comment system stripping my comments
That only makes sense if there's more competition WITHIN a single auction... not across multiple ad auctions. He made it clear that he was talking about the competition from Yahoo and Microsoft would drive up auction revenue for Google... which doesn't make sense.
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Comments on Google
Some people, predigilithic (I just made that up) in their conceptual framework, just don't get the internet model.
What Google is doing is beyond genius.
I've also come to think that their 'Don't Be Evil' mission statement is a litmus test for good vs bad. People who don't get, who are suspicious of it, can't understand that something like this is actualy possible for human beings to accomplish.
Those of us who get it share in the vision and have experienced the complete mutational transformation.
I say this is evolutionary enlightenment in action.
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Google Payments to Publishers
Google refuses to disclose to publishers exactly how it calculates the publisher's share of a click. Therefore if Google were to say that they have increased the publisher's cut, the publisher would have to take their word for it.
Maybe if Yahoo and Microsoft disclose their percentage then Google would be forced to follow suit.
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Googlenomics
Why not? People think that Wal-Mart opening a store and offering to hire people causes wages to fall. It's all from the same tetbook.
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