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As I mentioned in a previous comment, they know they'll make tremendous amounts of money from mobile search, and app sales (if/when they pick up for android).
by jmonegro 17y ago
As I mentioned in a previous comment, they know they'll make tremendous amounts of money from mobile search, and app sales (if/when they pick up for android).
Over a year, everyone with android will probably have supplied Google with hundreds of dollars of mobile search revenue.
If the Gphone sells for a low price, and in very high quantities, they will probably lose for every one sold, but will make much more per user than the $100-200 lost on production.
It also means more sticky users in the long run, popularizing android and turning more people towards google. More apps would be developed, other android phones will presumably sell more (unless the contrary happens, in which case it is the Gphone that sells, which means even more money for Google).
- eli 17y agoI wonder, how many thousands of mobile ads would I have to click on to generate $100 for Google?
- freetard 17y agoYou don't have to click ads, they pay by impression too.
- jmonegro 17y agotrue, you don't have to click them: every website you visit on android that has Google ads on it, or YouTube (more ads) would generate revenue to Google just by visiting it. Plus, some ads run for over $20+ per click, out of which Google surely makes a nice chunk out of, which means that, by these parameters combined, you don't really have to click many ads to generate $100 for Google. I reckon that over the course of a year (the average length of time at which users change their phones), you'd generate Google more (if not much more) than $100 in explicit and implicit revenue.
- glhaynes 17y agoBut every website you visit on iPhone that has Google ads on it, or YouTube generates the same amount of revenue to Google. Right? I mean, it's one thing if their big competitor here was Microsoft or, in other words, Bing. But iPhone already uses Google by default.
- jmonegro 17y agoTrue, but how does that change the situation? More phones means more revenue and more users. That's probably what they're looking at when thinking about subsidizing the handset.
- stanleydrew 17y agoNot sure about this, but I don't think Google takes a cut from Android Market app sales (unless you count the cut that Google Checkout gets, since a lot of apps are sold through that service). Can somebody who's got an Android app in the market weigh in on this?
- jmonegro 17y agoI assume Google makes a cut from those too. It wouldn't be hard to imagine that those who consume many apps over a period of time might also contribute towards covering for the subsidy.