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Google reported revenues of $2.46 billion for the quarter ended June 30, 2006, an increase of 77% compared to the second quarter of 2005 and an increase of 9% compared to the first quarter of 2006. Google reports its revenues, consistent with GAAP, on a gross basis without deducting traffic acquisition costs, or TAC. In the second quarter of 2006, TAC totaled $785 million, or 32% of advertising revenues.
As for publishers being screwed, the "traffic acquisition costs" payout to AdSense partner sites was just over 78.7 percent (about the same as in other recent quarters) or $62 million higher than in the first quarter of 2006.
I havent seen the option of borderless ads with adsense - am i missing something? Can anyone put up a weblink?
From the adsense blog:
What is your most important optimization tip for AdSense publishers?
Try to blend your ads by removing the border and using the same color as the background of your page. With this simple measure you can avoid ad blindness and also considerably boost your revenue.
trick users into thinking the ads are part of your navigation!
Sounds like a profit cocktail!
TypicalSurfer's point about user confusion is well taken, but it's a big stretch to suggest that blended AdSense ads are the reason for Google's revenue growth. In my opinion, his post is nothing more than an attempt to find an audience for his complaint by piggybacking on a high-profile thread.
The example provided by google that showed an improvement after ad "blending" by a publisher showed a doubling of clickthrough on adsense ads, that is a significant increase and no doubt in large part contributed to the revenue growth. Although it worked this quarter, that kind of growth is not sustainable, users adapt and will simply apply less trust (and clicks) to the publishers using sneaky ad presentation.
related: GOOG down a few points this AM after the "blowout", apparently the street is not fooled either.
[edited by: TypicalSurfer at 2:06 pm (utc) on July 21, 2006]
Now if they can eventually diversify their revenue, and actually monetize things other than search, they'll be a very good company to invest in for the long haul. To me, however, as soon as the "good times" in advertising fall back, Google will feel the pain.
Actually no matter what, as of now, GOOG is a TERRIBLE company to invest in. In fact it isn't investing, it is speculating. GOOG gives you no voting power and no dividend, so what do you get? Man, you don't even get certificates anymore, worthless "investment."
europeforadsenseclicks: nice defense, I doubt the borders did it all, it's probably the MFAs sending people from click to click as well as click fraud and don't forget loweing AS % paid to publishers oh and a little bit of crappy SERPs mixed in. Sounds like a profit cocktail!
"Sales from Google's partner sites generated through its popular "AdSense" program rose 58 percent to 997 million dollars."
Yah right.....where is all that money? Dismal daily earnings are all I (and many many other publishers) can see since the beginning of this year. Personally, going from an average of $120 per day to $20-25 p/day i read these reports and laugh. Carfully crafted Bull crap if you ask me.
[edited by: Web_speed at 9:03 pm (utc) on July 21, 2006]
I gotta say $120b is nice business to be holding onto....