Google holds a semi annual confab for its partners called Zeitgeist. The press is not invited, but a lof of folks I know end up going. The consensus from them is that the event has turned into a pretty traditional “make your clients happy” event. In other words, Google’s acting like every other company in the world that sells advertising for a living.
Forbes rounds it up here. From it:
Schmidt said that more than 1,000 people will ultimately work on Google’s efforts in radio advertising, which will someday sell radio ads over a modified version of its current Adwords placement service. “We’re trying to get a simplified Adwords interface where the advertiser gets multiple channels,” Schmidt said. The idea: Let a marketer allocate an ad budget across multiple platforms, either in an automated manner or by targeting times and regions.
The initiative to put ads in newspapers, ongoing since January, now has almost 100 newspapers, Schmidt said. Television advertising, he added, is still a long way off, but is planned.
And note this kicker to the piece:
One area Google won’t be moving into, the three said, is actual content creation. That’s a refrain the company has to constantly repeat in the face of concern by publishers and other media types who worry about the company’s ambitions. “We see ourselves as the best way to get to content,” said Schmidt.
“…and monetize it,” Page added.
This is why I think Google and YouTube make sense: no one else can position themselves in this way to Big Media. Other Big Media companies will sue the shit out of whoever buys YouTube. But Google has one hell of a legal team, and it’s entire business is based on the DMCA safe harbor. “We’re not here to compete with you guys for content creation,” Google says, “we’re here to partner with you!”
I don’t know, John. Google may have a hell of a legal team, but do they really want to spend all their time and treasure fighting YouTube’s legal battles instead of developing new technology?
I thought Google was teasing the lions by antagonizing Microsoft. Going up against Big Media too, well, that seems downright suicidal.
Sorry, John. If I can disagree here: I can see this move of Google to buy YouTube as act of desperation to diversify from one stream revenue business which is slowing down with click fraud and slowing economy on one side and finally sobering thoughts of founders on all crap products they announced which are not working and/or not wanted by anyone on another. I can imaging that after a big battle inside and clear understanding that all very expensive R&D are not bringing NEW PRODUCTS WHICH ARE ADDING to revenue and bottom line they were pushed to make a move which suppose to bring new dimension and advertisement space for monetisation efforts. Will it save GOOGLE from falling short of expectations – I doubt it. Apart from copyright issues fully described by Mark Cuban and others from business point of view this acquisition is wrong at the wrong point in time: YouTube is just a place where people are unloading their video content – it is real “LONG TAIL” staff, 99% of it will be seen just by creator and five other guys maximum. In order to monetise this audience media it will take ages and maybe never be profitable. If I would like to see news I will go to news portal, I will use good video search engine for lectures or similar CONTENT. Apart from hype this 1.6 billion investment will not bring any even middle term (1-3 years) google size meaningful revenues. So we have now very interesting point of Google business development cycle which will be reflected in earnings this and next quarter: no new working ideas from inside, all released products are not material in sense of revenue, strategy is to move into video space and buy out time but there is no clear business idea apart from proposal to advertisers: now we will put your add on every video download (99% is how I am cool dancing or baking or nice place in Zumbaramba). On the margin compression side we will have slowing growth of revenue due to click fraud recognition and slowing economy (not only YAHOO! disease), increasing Capex (now with not clear picture whether any of these investments are actually working) and expense related to options from 1st and 2nd q around 151 mil, so Free Cash Flow will be way below to reflect any sustainable multiple to the current stock
http://sufiy.blogspot.com/
As those of us making a living online know well the money comes from optimal monetization of content rather than the creation of the content. Google, as usual and brilliantly, is working to keep themselves in the driver’s seat as the premier way to monetize content online and moving to offline optimization.
They have the technology to optimize ROI on offline spends that (hopefully and probably) will blow many agencies out of the water. Traditional media campaigns and traditional ad agencies are a garbage dump of bad decisions and no research fueled by the ignorance of math-illiterate clients. Google has the power to change that and I’m glad they are looking in that direction.