Quick Google check: according to a recent 10-Q, the company is sitting on about $5.5 billion in cash after generating almost $1.6 billion in Q3 2005 revenues. But we knew that already.
Google’s principal source of revenue, of course, is advertising. About 56% of Google’s revenue comes from ads on Google’s own properties; about 43% come from ads on other web sites (eg other publishers, including blogs). The remaining 1% comes from a hodgepodge of sources, including product sales of lava lamps and Google-branded dog leashes (really).
Keyword pricing–the price advertisers pay so that their listing will appear on a relevant search or content page–is an important topic, then, for Google watchers.
According to Fathom Online, keyword prices fell from an average of $1.70 to $1.43 over the past 12 months (via MediaPost). More numbers:
Consumer services and mortgage look particularly unhealthy.
That said, Google’s investors don’t seem worried:
Why is Google’s stock price rising, even though keyword prices (at least by one measure) are declining precipitously? Two reasons:
- Overall spend in online search continues to rise dramatically.
- Investors believe Google will eventually develop revenue streams unrelated to search.
In any case, this post isn’t intended to suggest that Google is in trouble. However, if keyword pricing remains weak and overall search spend begins to slow, things may look a lot less rosy.
Left by Searchviews - Daily insights on Search Marketing, Social Media and SEO by Reprise Media. on December 31st, 1969