[leroybrown]

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The fact remains that Google is a one-trick pony: advertising. In Q2 of 2006, they made 2.46 billion from adverstising revenues. All other sources of revenue combined were 26.9 million, or just over 1%.

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Big deal, this is well-known.

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In addition, their growth rate has dropped precipitously. Down from %400 in 2002 to just under 80% in 2006. Granted, 80% is still impressive, but the trend is worth noting.

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Yeah - when did they introduce AdSense, and when did it really take off? I'm always amazed at its adoption rate. There are sites out there with ads that are nothing more than family photo albums... Besides, all growth rates taper off as a market becomes saturated. Big deal.

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They've been thrashing around for the past three years trying to find something else to make money at and have failed. In many ways they are like Microsoft. MS is struggling with no one upgrading Windows or Office software, MS' main source of revenue.

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MS makes money mostly off of one-time OS and software sales. They'd love a subscription model, but they don't have it. Conversely, Google has a steady influx of cash: every time you use a Google service, someone ponies up some money to Google.

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If the bottom ever drops out of web advertising (which wouldn't surprise me a bit: nobody likes ads on websites - which may explain the downward trend in Google's growth, as advertisers get disillusioned with web-based ad effectiveness), Google is history.

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Sure, if their revenue source dries up, they'll have a rough time. (This happened to Yahoo, btw, but they scraped through.) This is a lot like saying if Microsoft stops selling software, they'll go broke. Yup.

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This idea that a company that has never been able to do anything other than web-based advertising is somehow going to dethrone Microsoft and usher in the Millenium is completely irrational.

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Can you determine a company's competition soley by looking at its revenue source? I wouldn't think so. Sure, they have a lot of products/services out there that don't generate money, but you'd have to see what those products/services compete with. Microsoft would love to have a nice portal out there that was profitable...
Google does actually make money any time people use their products/services. There is advertising money coming in each time you do a search, each time you get directions on Google Maps, yadda yadda yadda.

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Here's what I think is happening with Google's web-based offerings: They want to mine the h* out of your data so they can sell it to advertisers.

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Yeah. Again, this isn't particularly new information. It's almost like saying that Google makes all its money off of ads or something /forums/ubbthreads/images/graemlins/grin.gif

[osxfoundry]

>>> Man, I don't know. Being on the Apple board is almost a contrarian indicator. Having the CEO of the Gap (now J. Crew CEO) on the board didn't prevent all Gap web sites from being Safari-hostile for a while not long ago.
Companies don't put people on Board just because they are at the head of big companies. There is usually a good reason.
Let's see ( i don't know all Apple Board members)
- Gap
Gap CEO came on board just before Apple started their Apple Retail Store.
Why? Because Gap has experience in Retail Store. They know the mistakes to avoid, location to choose etc... This was really beneficial for Apple.
- Al Gore
Relations. Al probably still has relations with a lot of companies and probably Education. And hopefully the next President will be democrat which might be an advantage.
- Google
Technology: They know about Tech ! Search engine, Ajax etc...

I don't think Apple and Google will merge. I don't see Apple and Disney merging either. Not same business model.
I could see Apple buying Akamai. I don't know if they still own 25% of the company. Apple is creating a content delivery business and they need the delivery system.
I could see Apple buying Sun. Apple has moved to Java. Sun servers are in Big companies. WebObjects is going Open Source.
The only problem, Sun makes their own processors which kind of goes against Apple business. HP bought Compaq and now they're doing pretty well.
Or maybe SGI.

[palane]

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The money isn't quite as rosy as you point out (though not as bleak as I thought).
The fact remains that Google is a one-trick pony: advertising. In Q2 of 2006, they made 2.46 billion from adverstising revenues. All other sources of revenue combined were 26.9 million, or just over 1%.
In addition, their growth rate has dropped precipitously. Down from %400 in 2002 to just under 80% in 2006. Granted, 80% is still impressive, but the trend is worth noting.

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Generally good points, though we disagree on their meaning. Exponential growth naturally comes to an end as markets mature. I would cite Amazon and eBay as companies that have succeeded as their businesses mature. Google's stock price will take a hit from those who've assumed that the growth rate will never come to an end. Google itself will merrily march on.

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They've been thrashing around for the past three years trying to find something else to make money at and have failed. In many ways they are like Microsoft. MS is struggling with no one upgrading Windows or Office software, MS' main source of revenue.

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Look at it a different way. Acquisitions generate traffic which in turn generates advertising revenue.

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If the bottom ever drops out of web advertising (which wouldn't surprise me a bit: nobody likes ads on websites - which may explain the downward trend in Google's growth, as advertisers get disillusioned with web-based ad effectiveness), Google is history. This idea that a company that has never been able to do anything other than web-based advertising is somehow going to dethrone Microsoft and usher in the Millenium is completely irrational.

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If the bottom drops out of web-based advertising, you can kiss most of the content on the web good-bye. Judging by what has happened to advertising in other media, webvertising is here to stay. Only if the site designer has gone overboard am I driven away from a site. Google's advertising is relatively restrained by comparison with most.

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Here's what I think is happening with Google's web-based offerings: They want to mine the h* out of your data so they can sell it to advertisers.

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That would be suicide. Consider the reaction to AOL's disclosure of web searches. If such activity would ever be disclosed, the damage to the company would be catastrophic.
PaL

[veggiedude]

I wonder how this will affect .Mac?
The amount of free stuff Google is giving away, soon .Mac will be obsolete, if it isn't already.
Maybe it is time Apple should retire .mac and let Google take this space over.