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> Google was down over the same period BECAUSE of Facebook This feels counter-intuitive to me as these are the major players in online advertising. A facebook

> Google was down over the same period BECAUSE of Facebook This feels counter-intuitive to me as these are the major players in online advertising. A facebook exodus would feel like a positive for google's primary revenue driver. Why is the inverse effect true?

shrimpx 9y ago
Loss of confidence in this overall space. Google relies on surveilling users and selling them to advertisers as much as Facebook or more.
- golfer 9y ago
  Google obviously relies heavily on ad revenue, but their business is far more diversified than FB. Consider: Google Play revenue (apps + media purchase/rental) Hardware (Pixel phone/Google home/Nest hardware) YouTube video ad revenue (brand based ads rather than search) Youtube TV, Youtube Red subscription revenue Google Cloud (>$1BB/quarter) Plus the other tech on the horizon, that if something pops here, it will be accretive to revs: Waymo Verily DeepMind Fiber (if it ever comes back in growth mode) Google Ventures Etc etc (struggled with formatting on this despite many attempts.. grr HN)
  - shrimpx 9y ago
    Yeah? And what's the ratio of ad revenue to total revenue in 2017?
    - e12e 9y ago
      This took surprisingly many searches to answer - I was expecting to find this neatly tabulated from earning reports etc. But anyway : "Alphabet generated $32.3 billion in revenue during the fourth quarter, up 24% from the same period last year. It was Alphabet’s highest-revenue quarter ever, beating out the prior quarter. About $27.2 billion of that revenue, or 85%, came from Google’s advertising business." https://qz.com/1195777/googles-swelling-advertising-business-couldnt-save-profits-in-q4-2017/ https://qz.com/1195777/googles-swelling-advertising-business... I also found it interesting how much Google pays for "traffic acquisition" (like paying Mozilla for default search etc): " In its most recently completed quarter, traffic-acquisitions costs were $6.5 billion, or 24% of Google’s advertising revenue, up 33% from the same period last year. Google’s strongest growth areas—mobile search and programmatic advertising—carry higher traffic-acquisition costs, Alphabet chief financial officer Ruth Porat said on the earnings call." (this is of course how Facebook is competing with Google: they have a captive audience that they additionally know very well). As far as I can tell ad revenue is growing faster than all of google's "hobby" projects... They're still an advertising company with a couple of tech projects in a shed in the garden.
QuackingJimbo 9y ago
People running "stat arb" strategies which see FB going down so they sell other tech stocks
bitxbit 9y ago
Good explanations here but it's mostly due to relative valuation and this is magnified by the fact that a lot of these big names are cross-listed among hundreds and thousands of ETFs. I cannot stress enough the impact ETFs and so called "smart" beta trading will have in the next couple of years.

shrimpx 9y ago

Loss of confidence in this overall space. Google relies on surveilling users and selling them to advertisers as much as Facebook or more.

golfer 9y ago
Google obviously relies heavily on ad revenue, but their business is far more diversified than FB. Consider: Google Play revenue (apps + media purchase/rental) Hardware (Pixel phone/Google home/Nest hardware) YouTube video ad revenue (brand based ads rather than search) Youtube TV, Youtube Red subscription revenue Google Cloud (>$1BB/quarter) Plus the other tech on the horizon, that if something pops here, it will be accretive to revs: Waymo Verily DeepMind Fiber (if it ever comes back in growth mode) Google Ventures Etc etc (struggled with formatting on this despite many attempts.. grr HN)
- shrimpx 9y ago
  Yeah? And what's the ratio of ad revenue to total revenue in 2017?
  - e12e 9y ago
    This took surprisingly many searches to answer - I was expecting to find this neatly tabulated from earning reports etc. But anyway : "Alphabet generated $32.3 billion in revenue during the fourth quarter, up 24% from the same period last year. It was Alphabet’s highest-revenue quarter ever, beating out the prior quarter. About $27.2 billion of that revenue, or 85%, came from Google’s advertising business." https://qz.com/1195777/googles-swelling-advertising-business-couldnt-save-profits-in-q4-2017/ https://qz.com/1195777/googles-swelling-advertising-business... I also found it interesting how much Google pays for "traffic acquisition" (like paying Mozilla for default search etc): " In its most recently completed quarter, traffic-acquisitions costs were $6.5 billion, or 24% of Google’s advertising revenue, up 33% from the same period last year. Google’s strongest growth areas—mobile search and programmatic advertising—carry higher traffic-acquisition costs, Alphabet chief financial officer Ruth Porat said on the earnings call." (this is of course how Facebook is competing with Google: they have a captive audience that they additionally know very well). As far as I can tell ad revenue is growing faster than all of google's "hobby" projects... They're still an advertising company with a couple of tech projects in a shed in the garden.

QuackingJimbo 9y ago

People running "stat arb" strategies which see FB going down so they sell other tech stocks

bitxbit 9y ago

Good explanations here but it's mostly due to relative valuation and this is magnified by the fact that a lot of these big names are cross-listed among hundreds and thousands of ETFs. I cannot stress enough the impact ETFs and so called "smart" beta trading will have in the next couple of years.