Google added another $1.3 billion in revenues in Q3 2010 -- almost all of it in the form of advertising sales -- to take in $7.3 billion for the quarter. Google is taking in so much cash right now that some fear it's in a bubble, spending money on vanity projects and follies such as a driverless car and a map of antarctica. That may be. But consider these five facts:
- Google gets double the average share of new advertising dollars, globally: Nielsen reports that global ad spending jumped 13 percent in the first half of 2010. Google's revenues jumped 23 percent, which means it took about double its "fair" share of every new advertising dollar entering the market -- globally. Bear in mind, Google doesn't even compete in many ad media such as newspapers, magazines, TV or billboards.
- Google gets more than double the average share of online ad revenues in the U.S.: Of course, Google more than holds its own online. Web ad revenue is increasing at a rate of about 11.9 percent, according to the Interactive Advertising Bureau. Google gets about double that rate.
- Google gets double what the TV business gets: Magna Global, a media buying firm owned by Interpublic (IPG), forecasts TV will grow 10.4 percent this year in the U.S. -- half the growth Google gets.
- Google gets more than seven times the share of new advertising dollars globally than WPP, the world's largest provider of advertising services: In Q2, WPP's revenues were up 3 percent to Â£4.441 billion, just a fraction of the sales boost Google got even though Google is coming off a much larger base.
- Google is seven times more profitable than other large ad agencies: Google takes only a minority cut of the ad dollars spent on its media. If you assume that Google's revenues are a 40.5 percent cut of its total sales, then Google actually handled $17.9 billion in what an ad agency would refer to as "billings." That's less than what WPP handles, which is Â£20.3 billion in billings. But then, WPP made only Â£182.6 million in profit from those billings, whereas Google made $2.2 billion -- about seven times as much.