Why Google feels lucky

Let me suggest that there are four sort of major thrusts around Google. One is that we’re busy building the world’s most interesting super-computers that are running new data services, search services and so forth. It’s very interesting — very, very exciting technology being built at Google.

Another has to do with end user solutions. How will users use information? All the global issues, all the controversies about that — a lot of people have issues and comments about that. A third has to do with advertising, and I’ll come back to that.

And the fourth has to do with the way Google is run and the way we make decisions and the culture that has grown around Google, which we’re obviously very proud of. In the third category, or fourth, we decided over the last couple of years to try to offer a full-scale set of application services, not just text ads.

So in doing this strategic analysis, we looked at text ads, display ads (banner ads, as you know them), we looked at radio, bought a company there [dMarc], television, we’re doing a series of trials there, acquired YouTube. Part of the reason being user phenomena, which is extraordinary and we’re very satisfied with that, but also because it’s obvious that online video will have a significant advertising component.

You put all that together and you think, what would the advertising customer like? And what they would like is they’d like a single way in which they can see ads and then have the computer do the allocation for them.

Advertising is really about relevance. It’s really about efficiency. It’s really about measurability, and there’s not been a lot of technology applied to advertising over the last 10 or 20 years, except for a few companies, DoubleClick being one of them. What was interesting about DoubleClick, since 2004 they’ve made a lot of changes to the way they operate and worked harder getting better tools and many, many companies are very, very happy with their products.

So when we looked at the business analysis, we thought a combination of the targeting that they do, the advertising and support tools that they built, combined with Google’s technology, would produce a better experience for the end-user.

So what we’ve said, and we’ve been saying this since, is that the user will be happier because they’re getting more targeted ads that will be faster to load. The advertiser will get more efficiency, more measurability, more targetability out of the combination. The publisher will get more reach, especially globally. So the math works.

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