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You're right about Android being important as a way of blocking competition, but it's false to say they are making billions on Android. It's just like all the

by gress 11y ago

You're right about Android being important as a way of blocking competition, but it's false to say they are making billions on Android. It's just like all the other free stuff they offer - it raises the bar for competitors, but it doesn't make them money. Saving money is not the same as making money.

rogerbinns 11y ago
Using nice round made up numbers let's say that a Google ad is displayed and clicked on iOS. Google got paid 10c for the ad, but then had to pay Apple 5c to be the search engine. Same story on Android, except they didn't have to pay Apple, but did have to pay to develop Android (1c). In the iOS scenario they are left with 5c, but in the Android scenario they are left with 9c. They are better off in the final accounting by 4c because of Android. Call that whatever you want, but they end up with more money and more profits. The "free stuff" is not free. It is a place to deploy ads and encourage use of other Google services which then provides more places to deploy ads (aka revenue opportunities). Even if no ads are involved, the user activity is very valuable. Knowing what people search for, where they go, who they communicate with etc let Google make better products. For example when showing search results, which ones the users click on is monitored. If they keep clicking on the 3rd result then that one should likely be higher. The more traffic you get the better you can make your search results because the users tell you. Navigation data tells you what physical places are popular, which again reinforces the search results (eg Chinese restaurants in your town). Even seeing mis-spellings helps. If you ask people who have tried multiple search engines why they use Google, the answer is usually the quality of the results. It is a vicious cycle and why Google has 70-80% of search traffic. Guess where that makes the advertisers go, and the more advertising demand the higher the rates that can be charged. The positive feedback loops around Google really help. Android does not directly add to Google's bottom line. It does however add over a billion users to Google products, significantly reduces the costs to access those users, does not place those users under someone else's control, and helps the revenues of those Google products they use which does show up in the bottom line.
- gress 11y ago
  None of this contradicts my point - Android doesn't make money for google. It just protects the advertising business.

by gress 11y ago

rogerbinns 11y ago

Using nice round made up numbers let's say that a Google ad is displayed and clicked on iOS. Google got paid 10c for the ad, but then had to pay Apple 5c to be the search engine. Same story on Android, except they didn't have to pay Apple, but did have to pay to develop Android (1c). In the iOS scenario they are left with 5c, but in the Android scenario they are left with 9c. They are better off in the final accounting by 4c because of Android. Call that whatever you want, but they end up with more money and more profits. The "free stuff" is not free. It is a place to deploy ads and encourage use of other Google services which then provides more places to deploy ads (aka revenue opportunities). Even if no ads are involved, the user activity is very valuable. Knowing what people search for, where they go, who they communicate with etc let Google make better products. For example when showing search results, which ones the users click on is monitored. If they keep clicking on the 3rd result then that one should likely be higher. The more traffic you get the better you can make your search results because the users tell you. Navigation data tells you what physical places are popular, which again reinforces the search results (eg Chinese restaurants in your town). Even seeing mis-spellings helps. If you ask people who have tried multiple search engines why they use Google, the answer is usually the quality of the results. It is a vicious cycle and why Google has 70-80% of search traffic. Guess where that makes the advertisers go, and the more advertising demand the higher the rates that can be charged. The positive feedback loops around Google really help. Android does not directly add to Google's bottom line. It does however add over a billion users to Google products, significantly reduces the costs to access those users, does not place those users under someone else's control, and helps the revenues of those Google products they use which does show up in the bottom line.

gress 11y ago
None of this contradicts my point - Android doesn't make money for google. It just protects the advertising business.