Adsense rates dropping, Google profits up

[Rocky]

Tweet

"Google is keeping an increasing proportion of the money it receives from advertisers. 77 per cent was passed on to partner sites, down from 85 per cent in the preceding quarter.

Over the entire calendar year last year, Google earned $3.19bn, almost exactly half of which came from its own properties and the rest from its ad brokerage. Revenues from the latter - which include Adwords and Adsense - are increasing at a faster clip: up 147 per cent over the year, compared a 101 per cent increase from its own properties."

http://www.theregister.co.uk/2005/02/02/google_q4_2004/

No wonder our income from Adsense has dropped by a quarter over the last few months.

Its about time for a bit more openness from Google about what they get and what we receive for Adsense ads.

After all, isn't it Google's motto never to be evil??

[Mogga]

But they have shareholders to worry about now.

[Coopson]

77% is still a higher % than the other PPC search engines. So i expect this figure will keep dropping.

[Rich]

I almost posted this last night when I posted the BBC link, but didn't as its not that clear. The original data is: -

The Google Network - Revenues generated on Google’s partner sites, through AdSense programs, contributed $490 million, or 48% of total revenues, a 92% increase over the Network revenues generated in the same quarter last year.

TAC - Traffic Acquisition Costs, the portion of revenues shared with Google’s partners, increased to $378 million or 77% of Google Network revenues. This compares to total payments to partners of $216 million in the fourth quarter of 2003, or 85% of Google Network revenues.

So, while it is quite clear that the revenues for The Google Network are soley from adsense, its not clear if Traffic Acquisition Costs include anything other than Adsense. Also you have to assume partners like AOL and ASK will be on a different rate to normal publishers and they will produce large enough volumes to swing the share a few %.

But, as Coopson said, 77% is still high. Google are basically saying its 3 times harder to get users to a website and click on an ad (your part of the work) than run a content recognition system, billing system, management system, crawlers, etc (their part of the work).

As far as I know the PPC search result feeds don't get near that level for even large affiliates. With those PPCs bringing out content targeted ads, I wonder if they will increase their revenue shares to compete with Google and whether these increases will filter to search feed users.