Google is planning once again to capture another market and earn billions of dollars. This time, the target is online website advertisements, which may even grow to a $10 billion market this year. Surprisingly, Google only attributes 4% of its total revenue to display advertisements online, around $1 billon. Compared to the rival company Yahoo, where they have been earning approximately $6.5 billion dollars from online advertising.
The iconic company
This year however, that may change, as Google is setting itself up for a come back. Google strategically acquired multiple companies to help with this online market, by purchasing Youtube for $1.65 billion, and Doubleclick for $3.1 billion. In addition, Google will use the marketing technology offered by another company that they bought, Teracents, and Google’s own technology called AdWords to effectively capture revenue from this growing market. Google is developing the advantages of cheaper advertising online and wishes to expand its grasp on the particular market. This move by Google has not gone unnoticed by their competitors, mainly Yahoo. CEO of Yahoo, Carol Bartz has made the announcement to step up interest in professional websites and other measures. This will definitely become a lively market for these giants to compete and it will be interesting to see what each company does next.
http://www.businessweek.com/technology/content/feb2010/tc2010027_356976.htm