I'd love to see the amount of clicks as well as cost per click - are businesses just paying more or are the amount of Adwords clicks increasing as well?

We all have various thoughts on how they do it, and lots of those aren't always positive - but what they have done from a revenue and profit standpoint has been without a doubt one of the most impressive business performances in history.

The run they have been on is staggering, and I just don't see anything on the horizon, competition or government intervention wise, thats going to slow it down one bit.

They are indeed on an impressive run. Personally, I think most of it is driven by a "land grab" for space and attention on the search results pages. Paid ads have heavily displaced organic results.

From a purely financial standpoint, that's of course, good for Google. I think, however, they have just about played that strategy out...you can't implement further land grabs once all the prime real estate is gone. It's a one-time trick.

The strategy has also arguably reduced the quality of the search results...the reason they became so popular in the first place. Whether or not that hurts them in the long run remains to be seen.

The strategy has also arguably reduced the quality of the search results...the reason they became so popular in the first place. Whether or not that hurts them in the long run remains to be seen.

I'd argue that the "land grab" has improved the quality of commercial search results (the only results that show evidence of a "land grab"). Google Shopping is obviously popular with both searchers and advertisers, partly because it shows images but also because it's less of a "Wild West" than the organic results are.

Searchers have long been exposed to ads in magazines, in newspapers, on TV, on radio, on billboards, etc., so why should they be offended by ads in search results? There's no reason to assume that Google will be hurt by making ads more prominent on commercial SERPs. Consider:

- Google's audience has grown enormously since AdWords were introduced in 2000, and so have Google's ad revenues.

- There's a long history of people reading specialty publications in part "for the ads." (I can remember when, as an amateur radio operator, I pored over all the ads in QST every month.) Targeted ads on SERPS are very much in the "endemic advertising" tradition.

Searchers have long been exposed to ads in magazines, in newspapers, on TV, on radio, on billboards, etc., so why should they be offended by ads in search results?

It's not the mere presence of ads that's the potential issue...it's how aggressive they are. The other mediums (TV, Radio, etc) have to manage that as well, or suffer consequences.

Google's ads are less "aggressive" than the ads in most media--or, for that matter, on many Web sites. (I've never seen a Google SERP use interstitials or pop-ups, for example.)

In any case, Google's traffic and revenue numbers make it pretty clear that searchers aren't jumping ship for other search engines. SEOs and marketers who rely on free advertising obviously aren't happy with Google's SERPs, but they aren't Google's target audience.

Food for thought: I'd also point out that pushing organic results lower on SERPs for commercial queries may contribute to better results over the long term by making SEO less cost-effective. There's bound to be a "sweet spot" where it makes more sense for a marketer to buy ads than to spend money on trying to influence Google's organic results.

Google's ads are less "aggressive" than the ads in most media

By what measure? Percentage of screen space versus percentage of air time on TV/Radio, printed page of a newspaper, etc?

Also, Google seems to be familiar with the idea that placement and amount of advertising can have a detrimental effect on quality :)

(http://googlewebmastercentral.blogspot.com/2012/01/page-layout-algorithm-improvement.html)

The run they have been on is staggering, and I just don't see anything on the horizon, competition or government intervention wise, thats going to slow it down one bit.

"Nobody expects the Spanish Inquisition."
-- M. Palin, et al.

rish3 wrote:
They are indeed on an impressive run. Personally, I think most of it is driven by a "land grab" for space and attention on the search results pages. Paid ads have heavily displaced organic results.

From a purely financial standpoint, that's of course, good for Google. I think, however, they have just about played that strategy out...you can't implement further land grabs once all the prime real estate is gone. It's a one-time trick.

The strategy has also arguably reduced the quality of the search results...the reason they became so popular in the first place. Whether or not that hurts them in the long run remains to be seen.

rish3 is exactly right. The "land grab" analogy is perfect. And all the prime real estate is indeed almost gone already. In addition, Google's implementation of this strategy could very well be part of the reason for the poor quality of their current search results. But of course, all of this should already be totally obvious to everyone.

It really is amazing how much of the above the fold space is no longer traditional organic results. This isn't specific to Google though. Organic results get even less pixels on Bing.

I don't think Google is in any trouble unless someone figures out how to give people the info they're looking for without ad funding.

I see the Google search engine more as a public utility now. It's not too dissimilar to a phone book where people can pay for ads. But the end result is a URL (just like a phone number). As we are seeing in Europe, the "right to be forgotten", is similar to the right to have an unlisted number in the phone book.

In terms of innovation in search, I think you can make the case there is less innovation now. In other areas Google innovating because they are competing still in other markets. In search, there isn't that much competition. You can draw a similarity to the break up of AT&T where they achieved great profits on long distance bills, but reached a point where innovation all but forgotten.

It really is amazing how much of the above the fold space is no longer traditional organic results. This isn't specific to Google though. Organic results get even less pixels on Bing.

Maybe, but defining "above the fold" is trickier than it was when most people had 640 x 480 or 800 x 600 displays.

In terms of innovation in search, I think you can make the case there is less innovation now. In other areas Google innovating because they are competing still in other markets. In search, there isn't that much competition. You can draw a similarity to the break up of AT&T where they achieved great profits on long distance bills, but reached a point where innovation all but forgotten.

Innovation in search is constant and impressive. Not only are Bing, Google (and a few others we hope might some say get more market share) competing with each other, they are in an endless arms race with black hat SEO. With white hat SEO too for that matter. Also with various kinds of fraud on the advertising side.

And then there's mobile search, where both location and physical actions become a factor. The innovation there is only just starting.

Search engines are in no way comparable to telephone directories. To create a phone number directory you just need to find the phone numbers and list them. It's incredibly simple. To create a search engine you need to combine a mind-bogglingly huge array of metrics, many of which are subjective, in an attempt to provide results that are as close as possible to what you imagine the users actually want. This being a moving target requiring perpetual tweaking and improvement. It's easy to determine the definitive home phone number for John Smith, not so easy to determine the definitive search result for "red flower"... because such a thing does not exist.

As far as competition goes, it would be nice to see more of it, but regulation can only deter anti-competitive practices, it cannot magically create a viable player in an industry like search. And, as history has repeatedly shown, regulation will often make it difficult or impossible for new players to enter a market. Certainly it makes it more expensive.

IMO treating search (i.e. ways to find stuff online) like a utility would, at best, solidify the hold the big players have on the market.

It's tech ignorance in lawmaking that allows things like the "right to be forgotten" to become law despite making absolutely no sense. Whatever article/post/whatever a particular person wants to go away; it is not hosted, created or maintained by search engines. They simply point to it. In my opinion these sorts of laws are wrong on all levels, but putting my opinion aside, the only implementation that makes logical sense would be to give people the right to have the offending information removed at the source. The site where it's posted, not the search engine that links to the site. This not only gets rid of the actual content but it puts a very small logistical burden on individual sites, which might get a few removal requests a year, instead of a huge logistical burden on search engines, making them more expensive to run and scaring away the next garage startup that would have changed the industry.

If G would quit including the ledgers from companies they acquire, the numbers would be less than tepid -- I wouldn't mind seeing the numbers on 'just Google' alone .. as it's my understanding that their core is losing money these days.

In other areas Google innovating because they are competing still in other markets.

Google hasn't come up with anything new or innovative since the 'Page Rank' --

Buying a pair of pants at the store and running home to tell your wife that you just 'built' a new pair of pants isn't innovation.
It's buying something that someone else built.