cayale Posted October 19, 2013 Share Posted October 19, 2013 So their solution is to force people to buy mobile ads: http://www.nytimes.com/2013/07/19/technology/google-misses-expectations-for-revenue-and-profit.html?pagewanted=all&_r=0 Short term fix until the ad optimization guys get involved. Regarding the quarter's results - surprise, surprise. ;) And it appears to be working for both advertiser and consumer. What's the problem? When you raise prices, you decrease ROI for advertisers. Then the ROI from competitors start looking better. Clicks are rising. In some areas, conversion is higher on mobile than desktop. CPC is coming down. So are they raising prices? And will customers be disappointed with the results? I'm not sure you can make the blanket assumption that ROIs are coming down. If customers sell more product as a result of more clicks, ROI might go up. Did they just force a bunch of customers into mobile? Yes. I don't think you can assume what happens to ROI, however, particularly in the long term. When you make a decision to advertise on Google or Facebook, you compare their relative ROIs. Limited inventory, limited functionality, limited purpose. Type "new car" into the search bar on Facebook and you get "New Bern, NC". You can link us to every article on the internet (cause everything one reads on the internet is true) as proof but if you're trying to tell me that 1) everybody is moving their ad dollars to Facebook and 2) Google is destined to shrivel up and die, I think you are stretching the limits of credulousness. I don't think that this world is quite as binary as that and I'd be a little wary of concluding Facebook has built a better mousetrap in terms of function, universality or utility to user and advertiser. ;D ;D ;D ;D ;D ;D You're kidding right? You know the difference between a search engine and a social network? You're kidding, right? You're trying to compare a limited function/limited purpose tool ROI to one with much broader reach, scale and scope. Link to comment Share on other sites More sharing options...
Palantir Posted October 20, 2013 Share Posted October 20, 2013 I stop following the markets for a week and my biggest holding is up like 15%? Yea baby! Link to comment Share on other sites More sharing options...
Guest valueInv Posted October 20, 2013 Share Posted October 20, 2013 You're kidding, right? You're trying to compare a limited function/limited purpose tool ROI to one with much broader reach, scale and scope. - This limited function/limited purpose tool is the second largest site on the web: http://www.alexa.com/siteinfo/facebook.com -This limited function/limited purpose tool tripled its ad marketshare within one year with products that are less than a year old: http://www.emarketer.com/Article/Facebook-Sees-Big-Gains-Global-Mobile-Ad-Market-Share/1010171 - Another limited function/limited purpose tool called Twitter is doubling its ad revenues again with products less than a reay old - A third limited function/limited purpose tool called Pinterest is just starting its monetization Link to comment Share on other sites More sharing options...
Guest valueInv Posted October 20, 2013 Share Posted October 20, 2013 Nice comments so far on the earnings today and Google's moat, and great infographic on the most expensive keywords. I just wanted to add two quick comments on the earnings. Google-owned site revenue was up 22% year-over-year. This is a big signal to me that YouTube revenue is ramping up and the monetization plan is working nicely. And, the "Other" segment revenues were up 85% yoy. This is where the Google Play resides and Chrome-based products as well. The ecosystem built on Android and Chrome is starting to earn some money in its own right. 1, How do you know that it is not search but Youtube that is generating site revenues? 2, We know other revenues is up 85%, where did you find the earnings for Android and Chrome? 1. We can never know for sure whether it's search or YouTube driving the revenue growth, but like I said, it's a "signal." As has been discussed in this thread, Search revenue growth has not been what it used to be, and the 22% yoy number of Owned Sites is nicely ahead of the 15-18% annualized growth it had been demonstrating for most of the past 2 years. This Q GOOG offered the following info on YouTube which sheds some light on how monetization is progressing: Moving over to brand in YouTube. You’ve seen that our CPG and entertainment clients have moved online at greater speed with our efforts that are on brand. Spend by our CPG clients on displaying YouTube has grown over 75% over the past two years. For example, the Google YouTube campaign for Dove’s Camera Shy brand in more than 20 countries and delivered over 62 million views for Unilever. We’re also partnering very closely with agencies, we really like integrating our technology, insights and media with their creativity and client relationships. For agencies, marketers and Googlers it's a huge win, win, win. All of the top 10 global agencies now use our DoubleClick products. On the other side YouTube continues to do well. Video ads which include CUview now form a significant part of our YouTube in brand advertising and they’re growing north of 75% year-over-year. We found that YouTube is our brand torch bearer. It offers brands valuable engaged audiences, terrific reach and compelling context. Smart brands are really loving their engagement with YouTube. YouTube is no longer a small business. Since Google doesn't segment it out, it's impossible to say exactly how big. Mark Mahaney at Citi projects that YouTube alone should pass $4B in revenues this year (it is estimated to have crossed $1b annual run-rate some time between 2011/12). 2. For several quarters now, the company has explained "Other" revenue growth, as it has been huge on an annualized basis, though from a small base. That small base is getting bigger, and growth isn't slowing much. Here is a quote from last quarter about "other" which clues us as to what resides there: Other revenue grew 138% year-over-year to $1 billion and roughly flat quarter-over-quarter. Play store digital sales of apps and content drove the year-on-year and quarter-over-quarter growth and it's worth noting that in Q1, we included some seasonal hardware sales due to overflow from Q4 which skewed the Q2 comps somewhat. I say "Android" because the Play Store is one of the most important paths to monetizing Android, and I say "Chrome" alongside Android because aside from some Nexus phones, this is the other type of hardware Google sells that would be situated in this segment. On 1, Are you sure? http://venturebeat.com/2013/10/16/a-full-third-of-googles-paid-clicks-now-coming-from-mobile-report/ On 2, Where are revenues from the Nexus devices included? Is there any Chromebook revenue included? How are gross margins, operating margins and FCF comparing on the YoY basis for this quarter and for the first 9 months? Link to comment Share on other sites More sharing options...
worldaccordingtoGARP Posted October 20, 2013 Share Posted October 20, 2013 Nice comments so far on the earnings today and Google's moat, and great infographic on the most expensive keywords. I just wanted to add two quick comments on the earnings. Google-owned site revenue was up 22% year-over-year. This is a big signal to me that YouTube revenue is ramping up and the monetization plan is working nicely. And, the "Other" segment revenues were up 85% yoy. This is where the Google Play resides and Chrome-based products as well. The ecosystem built on Android and Chrome is starting to earn some money in its own right. 1, How do you know that it is not search but Youtube that is generating site revenues? 2, We know other revenues is up 85%, where did you find the earnings for Android and Chrome? 1. We can never know for sure whether it's search or YouTube driving the revenue growth, but like I said, it's a "signal." As has been discussed in this thread, Search revenue growth has not been what it used to be, and the 22% yoy number of Owned Sites is nicely ahead of the 15-18% annualized growth it had been demonstrating for most of the past 2 years. This Q GOOG offered the following info on YouTube which sheds some light on how monetization is progressing: Moving over to brand in YouTube. You’ve seen that our CPG and entertainment clients have moved online at greater speed with our efforts that are on brand. Spend by our CPG clients on displaying YouTube has grown over 75% over the past two years. For example, the Google YouTube campaign for Dove’s Camera Shy brand in more than 20 countries and delivered over 62 million views for Unilever. We’re also partnering very closely with agencies, we really like integrating our technology, insights and media with their creativity and client relationships. For agencies, marketers and Googlers it's a huge win, win, win. All of the top 10 global agencies now use our DoubleClick products. On the other side YouTube continues to do well. Video ads which include CUview now form a significant part of our YouTube in brand advertising and they’re growing north of 75% year-over-year. We found that YouTube is our brand torch bearer. It offers brands valuable engaged audiences, terrific reach and compelling context. Smart brands are really loving their engagement with YouTube. YouTube is no longer a small business. Since Google doesn't segment it out, it's impossible to say exactly how big. Mark Mahaney at Citi projects that YouTube alone should pass $4B in revenues this year (it is estimated to have crossed $1b annual run-rate some time between 2011/12). 2. For several quarters now, the company has explained "Other" revenue growth, as it has been huge on an annualized basis, though from a small base. That small base is getting bigger, and growth isn't slowing much. Here is a quote from last quarter about "other" which clues us as to what resides there: Other revenue grew 138% year-over-year to $1 billion and roughly flat quarter-over-quarter. Play store digital sales of apps and content drove the year-on-year and quarter-over-quarter growth and it's worth noting that in Q1, we included some seasonal hardware sales due to overflow from Q4 which skewed the Q2 comps somewhat. I say "Android" because the Play Store is one of the most important paths to monetizing Android, and I say "Chrome" alongside Android because aside from some Nexus phones, this is the other type of hardware Google sells that would be situated in this segment. On 1, Are you sure? http://venturebeat.com/2013/10/16/a-full-third-of-googles-paid-clicks-now-coming-from-mobile-report/ On 2, Where are revenues from the Nexus devices included? Is there any Chromebook revenue included? How are gross margins, operating margins and FCF comparing on the YoY basis for this quarter and for the first 9 months? 1. What's the point of responding to a line that beings with "We can never know for sure" by asking the question "are you sure?" It's a smart, reasonable assumptions, yes assumption, not firm fact, that YouTube is growing as indicated above based on reading the company's filings and listening to their CCs over several years. 2. Nexus and Chromebook are included and I did say that above, not sure why you're asking... Gross margins dropped 100 BPS (ex Mot), operating margins for the co were up 130 BPS, CFFO up 25% though FCF down due to higher CAPEX. But we know that you know this, so why are you asking? Enlighten us...it's unnecessarily patronizing to ask such leading questions without offering thoughts of your own. I must say ValueInv, from what I see on this thread you have responded to every single point on Google (whether positive or negative), with your own negative spin. Is there a reason for this? Seems like some evident bias to me. Link to comment Share on other sites More sharing options...
bmichaud Posted October 20, 2013 Share Posted October 20, 2013 It's his moral duty to correct anyone and everyone's view on tech, positive or negative, because he is the omniscient, omnipotent tech guru....while in the meantime destroying any and all tech threads for the average reader :) Link to comment Share on other sites More sharing options...
Guest valueInv Posted October 21, 2013 Share Posted October 21, 2013 It's his moral duty to correct anyone and everyone's view on tech, positive or negative, because he is the omniscient, omnipotent tech guru....while in the meantime destroying any and all tech threads for the average reader :) And here I am thinking that I was only an irrationally biased Apple fanboy. ;D ;D ;D Link to comment Share on other sites More sharing options...
VAL9000 Posted October 21, 2013 Share Posted October 21, 2013 Really interesting article about Google's Android. Fairly technical but insightful analysis into how Google is tightening its lasso around the "wild west" Android handset market: http://arstechnica.com/gadgets/2013/10/googles-iron-grip-on-android-controlling-open-source-by-any-means-necessary/ This approach looks like it has a good shot at standardizing handsets across many manufacturers. It could kill off the Kindle forking efforts due to the economics of keeping up with Google's development and the challenge of maintaining a sub-standard App store. Link to comment Share on other sites More sharing options...
Guest valueInv Posted October 22, 2013 Share Posted October 22, 2013 Really interesting article about Google's Android. Fairly technical but insightful analysis into how Google is tightening its lasso around the "wild west" Android handset market: http://arstechnica.com/gadgets/2013/10/googles-iron-grip-on-android-controlling-open-source-by-any-means-necessary/ This approach looks like it has a good shot at standardizing handsets across many manufacturers. It could kill off the Kindle forking efforts due to the economics of keeping up with Google's development and the challenge of maintaining a sub-standard App store. I am shocked, I say, shocked that Google would do this ::): Now we are getting somewhere. Google isn't any more open than most companies, it's just marketing. Since you mentioned their strategy - here it is: Commoditize the complement. They open source or undercut competitor's products and give them away for free or low cost hoping to make money up the value chain in advertising. The free giveaway allows them to get marketshare quickly. It's no surprise that they are not open sourcing their core technologies, they are not an open company, they're a commoditization company. They're open where it suits them - competitors strengths. Android is a child of this model. Google is no Red Hat. Link to comment Share on other sites More sharing options...
Guest valueInv Posted October 22, 2013 Share Posted October 22, 2013 On the Android gives Google control theory: http://gigaom.com/2013/10/22/even-old-ipads-are-hot-accounting-for-81-of-web-traffic-on-tablets-in-n-a/ Link to comment Share on other sites More sharing options...
Guest valueInv Posted October 24, 2013 Share Posted October 24, 2013 So their solution is to force people to buy mobile ads: http://www.nytimes.com/2013/07/19/technology/google-misses-expectations-for-revenue-and-profit.html?pagewanted=all&_r=0 Short term fix until the ad optimization guys get involved. Regarding the quarter's results - surprise, surprise. ;) And it appears to be working for both advertiser and consumer. What's the problem? When you raise prices, you decrease ROI for advertisers. Then the ROI from competitors start looking better. This is what I mean: http://techcrunch.com/2013/10/24/pricing-engine-adwords-bing/ Link to comment Share on other sites More sharing options...
siddharth18 Posted October 24, 2013 Share Posted October 24, 2013 This is what I mean: http://techcrunch.com/2013/10/24/pricing-engine-adwords-bing/ The article provides "facts" but these facts alone aren't sufficient to reach a conclusion that you reach. Remember - Google doesn't "raise" or "lower" prices. It's a bidding driven eco-system where millions of advertisers drive the click costs up and down based on their return. Which means if more advertisers enter the bidding process, ceteris paribus, the prices in aggregate will tend to move higher. Advertisers are generally shrewd about managing their online ad spending and measuring the direct return on ad spend is quite simple. No advertiser would be paying higher costs without justification. And the justification here for higher prices, I suspect, is that Google has higher quality of traffic (better conversion rate) and hence commands higher rates. If the economy craters, advertisers in aggregate will be reduce their bid per keyword and the prices, in aggregate will drift lower. Simply comparing CPCs is meaningless and the conclusions based on those comparisons are specious if you don't account for the return on each dollar spent. Link to comment Share on other sites More sharing options...
Guest valueInv Posted October 25, 2013 Share Posted October 25, 2013 This is what I mean: http://techcrunch.com/2013/10/24/pricing-engine-adwords-bing/ The article provides "facts" but these facts alone aren't sufficient to reach a conclusion that you reach. No, these are just data points. Combine them with other data points I have posted. Remember - Google doesn't "raise" or "lower" prices. It's a bidding driven eco-system where millions of advertisers drive the click costs up and down based on their return. Which means if more advertisers enter the bidding process, ceteris paribus, the prices in aggregate will tend to move higher. No, but it has tools to influence the prices of ads. Why do you think they introduced "Enhanced Ads"? Why are they bundling desktop and mobile ads? Also, if more advertisers spread out their marketing budget between Google, FB, Twitter and Pinterest, the amount they bid on Google ads will fall and you will see a decline in CPCs. Advertisers are generally shrewd about managing their online ad spending and measuring the direct return on ad spend is quite simple. No advertiser would be paying higher costs without justification. Not as much as you think over the short term. Last quarter a couple of ad optimizers reported increasing CPCs at Google while it was later revealed in the earnings report that CPCs actually fell. No the optimizers actually calculate CPCs across the campaigns they are running at Google for their clients. That means, they paid a higher rate for their clients while in the average rate actually fell. Another example of this. CPCs for mobile ads have been lower, while Google actually claims that they have a better ROI on mobile due to better target, mobile devices are personal, yada, yada, yada. If Google is right, wouldn't the shrewd advertisers figure it out and bid more for mobile ads? Do they know something that we don't? And the justification here for higher prices, I suspect, is that Google has higher quality of traffic (better conversion rate) and hence commands higher rates. If the economy craters, advertisers in aggregate will be reduce their bid per keyword and the prices, in aggregate will drift lower. Do you have any data on this? Simply comparing CPCs is meaningless and the conclusions based on those comparisons are specious if you don't account for the return on each dollar spent. Which is why the article considers CTRs also. BTW, I had requested eCPM data a while back also. Here is something to think about: http://www.theguardian.com/technology/2013/oct/24/google-breaks-promise-banner-ads-search-results Why are they doing this? Here is another example of them trying to squeeze revenue: http://venturebeat.com/2013/10/09/google-is-killing-the-keyword-unless-you-pay-heres-what-to-do-about-it/ Also, take a look at this: http://venturebeat.com/2013/06/17/why-the-half-life-of-a-pinterest-pin-is-thousands-of-times-longer-than-a-tweet-or-facebook-post/ Link to comment Share on other sites More sharing options...
Guest valueInv Posted October 29, 2013 Share Posted October 29, 2013 This is what I mean: http://techcrunch.com/2013/10/24/pricing-engine-adwords-bing/ The article provides "facts" but these facts alone aren't sufficient to reach a conclusion that you reach. Remember - Google doesn't "raise" or "lower" prices. It's a bidding driven eco-system where millions of advertisers drive the click costs up and down based on their return. Which means if more advertisers enter the bidding process, ceteris paribus, the prices in aggregate will tend to move higher. Advertisers are generally shrewd about managing their online ad spending and measuring the direct return on ad spend is quite simple. No advertiser would be paying higher costs without justification. And the justification here for higher prices, I suspect, is that Google has higher quality of traffic (better conversion rate) and hence commands higher rates. If the economy craters, advertisers in aggregate will be reduce their bid per keyword and the prices, in aggregate will drift lower. Simply comparing CPCs is meaningless and the conclusions based on those comparisons are specious if you don't account for the return on each dollar spent. More on ROI: http://venturebeat.com/2013/10/28/social-ad-roi-skyrockets-facebook-click-rate-up-275-twitter-revenue-per-visitor-up-4x/#vb-gallery:1:848090 http://venturebeat.com/2013/10/28/tumblrs-value-to-advertisers-undervalued-by-as-much-as-450/ Link to comment Share on other sites More sharing options...
Guest valueInv Posted October 29, 2013 Share Posted October 29, 2013 On the "Android gives Google control theory": http://gigaom.com/2013/10/28/samsung-is-pulling-another-amazon-on-android-but-this-is-even-bigger/ Link to comment Share on other sites More sharing options...
Palantir Posted October 29, 2013 Share Posted October 29, 2013 Is anyone selling GOOG? I knew what price I wanted to buy at...but didn't think about what I wanted to sell at... :-[ Personally, I'd prefer to let it run....especially if it is going from value to growth to momentum...but don't want to hold an overvalued stock...oh well, probably will do nothing. Link to comment Share on other sites More sharing options...
txlaw Posted October 29, 2013 Share Posted October 29, 2013 Is anyone selling GOOG? I knew what price I wanted to buy at...but didn't think about what I wanted to sell at... :-[ Personally, I'd prefer to let it run....especially if it is going from value to growth to momentum...but don't want to hold an overvalued stock...oh well, probably will do nothing. You can always just make a decision based on portfolio sizing and reduce to your acceptable percentage of the portfolio. I don't own any GOOG right now (kicking myself for that), but I believe it is one of the few Phil Fisher type stocks that would be worth holding for the long run. Meets the 15 Points quite nicely. Link to comment Share on other sites More sharing options...
TwoCitiesCapital Posted October 30, 2013 Share Posted October 30, 2013 Is anyone selling GOOG? I knew what price I wanted to buy at...but didn't think about what I wanted to sell at... :-[ Personally, I'd prefer to let it run....especially if it is going from value to growth to momentum...but don't want to hold an overvalued stock...oh well, probably will do nothing. I sold 25% of my position at $700 and another 50% at $900. I'm holding the last 25% more for emotional reasons (Google is my favorite company and buying shares back in 2008 was a milestone for me). I'll consider selling this chunk if it gets to 35-40x earnings but may not even at that point. Link to comment Share on other sites More sharing options...
Guest valueInv Posted November 1, 2013 Share Posted November 1, 2013 Ding!! Round 2: http://feedproxy.google.com/~r/OmMalik/~3/u4MRfnTo4aQ/ Link to comment Share on other sites More sharing options...
Guest valueInv Posted November 5, 2013 Share Posted November 5, 2013 Remember the "honeypot" or the competition is increasing theory? http://www.bloomberg.com/news/2013-11-04/rumors-clash-with-reality-as-htc-tries-to-spell-out-its-future.html Link to comment Share on other sites More sharing options...
Palantir Posted November 5, 2013 Share Posted November 5, 2013 Sad, HTC has the best looking phones out of any manufacturer IMO, including Apple. Their 8X Windows phone IMO is the best. Link to comment Share on other sites More sharing options...
Liberty Posted November 5, 2013 Author Share Posted November 5, 2013 Sad, HTC has the best looking phones out of any manufacturer IMO, including Apple. Their 8X Windows phone IMO is the best. You and I have very different tastes (and that's fine). To me that looks like a generic disposable phone :) http://www.htc.com/managed-assets/shared/desktop/smartphones/htc-wp-8x/features/wp8x-f2-1.png Link to comment Share on other sites More sharing options...
fareastwarriors Posted November 12, 2013 Share Posted November 12, 2013 http://online.wsj.com/news/articles/SB10001424052702303914304579192211449903486?mod=Business_newsreel_9 Google Relents on YouTube Ad Measurement Nielsen to Begin Tracking Viewership of Videos Link to comment Share on other sites More sharing options...
txlaw Posted November 15, 2013 Share Posted November 15, 2013 Moto G -- what the iPhone 5C should have been? http://readwrite.com/2013/11/13/motorola-announces-the-moto-g-the-highest-quality-budget-smartphone-on-the-market And see how Kit Kat powers the Android Home interface using Google Search. http://arstechnica.com/gadgets/2013/11/google-just-pulled-a-facebook-home-kitkats-primary-interface-is-google-search/ Once again, we see how Android is really a way to defend and expand the use of its most important software and services. Let's hope that they continue to cause ASPs to go lower and lower for everyone, not just emerging markets. Link to comment Share on other sites More sharing options...
Guest valueInv Posted November 15, 2013 Share Posted November 15, 2013 Moto G -- what the iPhone 5C should have been? http://readwrite.com/2013/11/13/motorola-announces-the-moto-g-the-highest-quality-budget-smartphone-on-the-market And see how Kit Kat powers the Android Home interface using Google Search. http://arstechnica.com/gadgets/2013/11/google-just-pulled-a-facebook-home-kitkats-primary-interface-is-google-search/ Once again, we see how Android is really a way to defend and expand the use of its most important software and services. Let's hope that they continue to cause ASPs to go lower and lower for everyone, not just emerging markets. The G should do wonders for the money they Motorola is already losing. ;) Further, most Android vendors (except Samsung) are already losing money. The faster Google drives Down prices, the faster they will have to exit the market. Further, by taking control of Android, they are limiting partners ability to differentiate. And here starts the Android civil war. Link to comment Share on other sites More sharing options...
Recommended Posts
Create an account or sign in to comment
You need to be a member in order to leave a comment
Create an account
Sign up for a new account in our community. It's easy!
Register a new accountSign in
Already have an account? Sign in here.
Sign In Now