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How does Google make money?

20 Replies Christopher Roberts

The other day someone asked me how Google makes its money. At the time I called upon the knowledge I had and talked about the ads they have in the search results, the Chromebooks and Android systems they are selling, and Google Apps and Docs.

This week Google announced, it was disappointed with its 27% rise in revenues. Yes you read right, it was disappointed! Profits were up 6.4% and revenues 27%. In the same period, (the last quarter of 2011) Microsoft saw its revenues rise just 5%, and its profits fall by 0.15%!

Here is the interesting (weird) thing, Google’s share value fell 10% after the announcement, whilst Microsoft’s grew by around 2%! How crazy.

Anyway, this got me thinking, what are all the way Google makes money, as that is a lot to get just from the ways I mentioned.

How does Google make money?

The fact is, the majority of Google’s revenues come from the ads it presents to users on search result pages. However in recent years it has started making more and more money in other ways. So what are these other ways Google makes money?

Chromebooks

Introduced mid last year, Chromebooks are laptops powered by Google Chrome OS, where the laptop and the internet are one. There are no programs, desktop or start menu, the who experience runs from the cloud, utilising all Google’s (and other) online applications.The Google Chrome Logo

Samsung and Acer are the two firms which currently offer Chrome OS powered laptops, however expansion to more brands in the future is inevitable. Samsung and Acer obviously take their share the sales, as will Amazon and the other places Chromebooks are sold, however the laptops do make money for Google.

Android

I assumed that Google made money from Android, however I was wrong – Google does not make money from its Android mobile operating system. Android is a Google-led open source mobile OS framework, however Google does not profit from it.

Google Android's Logo

YouTube

Since Google bought YouTube in 2006, the site hasn’t been that profitable for it. YouTube is now the site with the third most traffic on the web, meaning that it has huge potential, however until recently, it was only making money from ads.

Before Google AdSense ads used to appear alongside videos, which they still do, however now they also advertise within videos too. Furthermore, YouTube have started offering online movies, which users can pay to watch from the comfort of their own home – or wherever they are.

Google Storage

Many Google services offer online storage, however this is only a finite amount. Should you want to purchase extra storage for Gmail, Google Docs, Picasa or Blogger (photos on blogger, not posts) then you can do so from Google Storage. I doubt this brings in Google a lot of revenue, but nerveless, it makes the internet giant some money.

Google Store

Google have an online store which distribute to may different locations around the world. They sell everything from branded keyrings and juggling balls, to t-shirts and even accessories with past Google Doodles printed on them.

DoubleClick, AdSense and AdWords

The majority of Google’s revenues come from the advertisers who use AdWords and DoubleClick. These ads are then either shown in the search results, or on websites which host AdSense units. Google makes lots of money out of ads. It doesn’t tell AdSense hosts what cut of the advertisers fees they get, but it makes Google a lot of money, so I would guess that they take home more than website owners hosting their ads.

Other Ways Google Makes Money

These are not the only ways Google makes money, other ways include, Google Apps for Business, Google Cloud Connect, Google Docs, Feedburner (through ads), Google Earth Pro, Google Mini (where you effectively buy the Google search engine to use on your own site/intranet), Google Checkout and more.

Hopefully this gives you some insight into just how many ways there are that the search giant that is Google makes money.

Search engines are changing the way our memory works

17 Replies Christopher Roberts

A recent article in Science Mag suggests that the use of computers and the internet might actually be changing the way our memory works.

A series of psychology experiments recently carried out have shown that sometimes, when people were presented with hard to answer questions, they began to think of computers.

If participants believed that it would be easy to find answers on Google later, then they had poorer recall of the actual answer, and yet a greater memory of where the answer was stored.

A head x-ray showing someone with a computer for a brainThe researchers said that the internet acts as a tool which we now depend upon to to aid our memories, by remembering some data for us.

Here is the abstract for the journal entry

The advent of the Internet, with sophisticated algorithmic search engines, has made accessing information as easy as lifting a finger. No longer do we have to make costly efforts to find the things we want. We can “Google” the old classmate, find articles online, or look up the actor who was on the tip of our tongue. The results of four studies suggest that when faced with difficult questions, people are primed to think about computers and that when people expect to have future access to information, they have lower rates of recall of the information itself and enhanced recall instead for where to access it. The Internet has become a primary form of external or transactive memory, where information is stored collectively outside ourselves.

In more simplified English, what this is basically saying is that it is now much easier to access data online, mainly thanks to search engines like Google, Bing and Yahoo. If we have a question, we can find the answer in seconds.


This has lead the the human brain associating the thought of a problem with computers, as it believes that the internet will be the source of the solution. Search engines are now embeded so much in our brain, that when we think of a problem, we no longer bother trying to work out the answer for ourselves, but instead we associate the possibility of finding the solution of the problem with a search engine.

Let’s be honest, who hasn’t been bugged by something, asked someone else who also wasn’t able to help and as a result was either told “Google it” or thought “I could Google that”? I have, in fact I would say it happens on a weekly basis!

Question time

So what do you think? Are computers, the internet and search engines making us stupid, or is it just that we are now adapting as a race to more efficient ways of finding out information?