4 ms·

I'm becoming less a fan of Thiel as time goes on, his ideas seem to be superficial and often harmful. Saying that google is an ad company is a mistake. Just be

I'm becoming less a fan of Thiel as time goes on, his ideas seem to be superficial and often harmful. Saying that google is an ad company is a mistake. Just because that's where the revenue, the sustenance comes from as a primary source. But that revenue exists because of google's market domination in search and other services. If google stopped being a search company their ad revenue would dry up overnight. Saying that google is an ad company is like saying that a particular software dev. is not a "software person" but a "burrito person", because they happen to eat burritos a lot. At the end of the day google's revenue comes about because they provide something of value to their users, and advertisments are a way to monetize that value effectively. No different than broadcast tv or radio. But it's the value which is the foundation of the company, the revenue is merely a consequence of that value. Thinking that the revenue stream is an intrinsic part of the company is a mistake that has doomed many companies before. Think about newspapers, I'm sure many of them thought of themselves as advertising companies to a substantial degree, and when that revenue dried up because the value of the newspaper changed, many of them were left wondering what to do, many of them have already gone out of business, many more still will. Hopefully google won't make the same mistake and alienate its users more than it has already or ignore competition before it's too late.

dcurtis 12y ago
Google is definitely an ad company, but its main product is Google Search.
ethnomusicolog 12y ago
What you are saying is exactly the point of Peter Thiel. Basically he is saying that Google is a search company, with a monopoly in search, and they try to pass as a an advertising company (the Ericschmidt quote). According to Peter thiel that is SOP for companies that have a monopoly in a market. they do this for many reasons, including evading regulatory oversight. So it seems to me you are agreeing with him.
- pi-err 12y ago
  I see Google as an automation company based on data and monetized by advertising. Does it make Google an advertising company? Yes by the bottom line, no by this strategy. It just happens it's the best way to monetize what they have so far. Analogy: would you define 1905 Einstein as a patent clerk or a scientist?
- netcan 12y ago
  It's just hard to boil down the dynamic to a statement like that, Google is an X company. Google invented a search engine where everyone found stuff on the web easier than other methods. They then built an advertising platform that complimented it. The two are highly interlinked. They invented and got good at both. You can look at things from a distant POV with too few details just like you can look at it from a perspective that's too close, to many details. There is no method apart from using your faculties that can replace having good faculties and the ability to apply perspective.
  - JetSpiegel 12y ago
    If by "complemented it" you mean ruined it and moots the point of PageRank, sure.
    - netcan 12y ago
      No. That's not what I meant.
- EGreg 12y ago
  Google is an "X" company, solve for "X" Ok lets see it's mission is to organize the world's information and make it universally accessible and useful. Therefore Google is an information organization company. More than search, it's also monetizing the effort of getting all the information into proprietary databases and keeping them up to date. Google Maps, Google Places, Google Search, etc. Then they monetize it by advertising, as well as running their own commerce - app stores and the like. And they also give businesses Analytics, Email, Docs and other Apps that they have now unified with Google+ as well as Google Checkout for payment processing. Now Apple, Google and Amazon compete in phone OSes, payment processing platforms etc.
brandonmenc 12y ago
> google's revenue comes about because they provide something of value to their users Their revenue comes about because they provide something of value to advertisers: users. Yes, search results are valuable, but not valuable enough to charge for them - unlike ads. It's chicken-egg, but their value is not simply in providing search results.
- piyush_soni 12y ago
  Depends how you see it. No user would come to Google if it wasn't good enough in search, and consequently no company would want to advertize with it if no one visited Google. The "inherent" value of Google is due to its Search Engine - they just found a way to monetize it heavily. It's a win-win game for both advertizers and users.
reitzensteinm 12y ago
You're really arguing against a straw man here. Thiel was talking about the motivations monopolistic companies have to obfuscate how people view their market. If Google is a search company, it holds 2/3 of the market. If it's an ad company, its revenues are equal to ~1/10 of global ad spending. Therefore, if Google doesn't want to be seen as a monopoly, it is in its interest to have the public face of an ad company, even if it views itself internally as a search company. Which to me is an interesting, subtle point.

dcurtis 12y ago

Google is definitely an ad company, but its main product is Google Search.

ethnomusicolog 12y ago

What you are saying is exactly the point of Peter Thiel. Basically he is saying that Google is a search company, with a monopoly in search, and they try to pass as a an advertising company (the Ericschmidt quote). According to Peter thiel that is SOP for companies that have a monopoly in a market. they do this for many reasons, including evading regulatory oversight. So it seems to me you are agreeing with him.

pi-err 12y ago
I see Google as an automation company based on data and monetized by advertising. Does it make Google an advertising company? Yes by the bottom line, no by this strategy. It just happens it's the best way to monetize what they have so far. Analogy: would you define 1905 Einstein as a patent clerk or a scientist?
netcan 12y ago
It's just hard to boil down the dynamic to a statement like that, Google is an X company. Google invented a search engine where everyone found stuff on the web easier than other methods. They then built an advertising platform that complimented it. The two are highly interlinked. They invented and got good at both. You can look at things from a distant POV with too few details just like you can look at it from a perspective that's too close, to many details. There is no method apart from using your faculties that can replace having good faculties and the ability to apply perspective.
- JetSpiegel 12y ago
  If by "complemented it" you mean ruined it and moots the point of PageRank, sure.
  - netcan 12y ago
    No. That's not what I meant.
EGreg 12y ago
Google is an "X" company, solve for "X" Ok lets see it's mission is to organize the world's information and make it universally accessible and useful. Therefore Google is an information organization company. More than search, it's also monetizing the effort of getting all the information into proprietary databases and keeping them up to date. Google Maps, Google Places, Google Search, etc. Then they monetize it by advertising, as well as running their own commerce - app stores and the like. And they also give businesses Analytics, Email, Docs and other Apps that they have now unified with Google+ as well as Google Checkout for payment processing. Now Apple, Google and Amazon compete in phone OSes, payment processing platforms etc.

brandonmenc 12y ago

> google's revenue comes about because they provide something of value to their users Their revenue comes about because they provide something of value to advertisers: users. Yes, search results are valuable, but not valuable enough to charge for them - unlike ads. It's chicken-egg, but their value is not simply in providing search results.

piyush_soni 12y ago
Depends how you see it. No user would come to Google if it wasn't good enough in search, and consequently no company would want to advertize with it if no one visited Google. The "inherent" value of Google is due to its Search Engine - they just found a way to monetize it heavily. It's a win-win game for both advertizers and users.

reitzensteinm 12y ago

You're really arguing against a straw man here. Thiel was talking about the motivations monopolistic companies have to obfuscate how people view their market. If Google is a search company, it holds 2/3 of the market. If it's an ad company, its revenues are equal to ~1/10 of global ad spending. Therefore, if Google doesn't want to be seen as a monopoly, it is in its interest to have the public face of an ad company, even if it views itself internally as a search company. Which to me is an interesting, subtle point.