More to come Google (NSDQ: GOOG) growth rate and all that entailsclick through rates, query growth, ad quality, etc.continues to be the subject of a lot of disagreement and debate. Q1 turned out solid, but there's not going to be a letup in the key question facing the company: are its heady growth days done for? Speaking at the Goldman Sachs Ninth Annual Internet Conference, Nick Fox, Director of Business Product Management at Google tried to to pull back the thicket of the company's business: "there are significant opportunities across the board.".He described the four drivers of revenue: queries, ads per query, quality, price per lead, and noted for example that many queries still don't have ads running against them: "A small portion of our queries have ads we see that as a pretty significant opportunity." The challenge is to convince advertisers that they could be making money by bidding on more keywords than they are. Other opportunities include helping companies improve the quality of their landing pages (so they get more value from their ads) and rethinking the ads that go next to each query. Fox's example: Amazon.com ads for the book Harry Potter don't generate many clickthroughs because searchers often are looking for something else than the book itself.
-- Social networks: "What I would say on social networks the whole industry has been surprised at the difficulty of monetizing social networks." "We found it more challenging that we expected it would be." The difference: "On search you have this amazing thing: the query on a social network, you don't really know (what the user is looking for)." Other problems: users are doing a lot of non-commercial things on social networks (he mentioned throwing sheep and playing Scrabble). Those who are making money: "scummy things" like pyramid schemes and things that trick users into downloading ringtones.
-- Mobile: "Mobile is much more similar to search than a social network is mobile actually monetizes quite well." New devices are key: iPhone users search at a rate of 50x normal users. Also, on mobile, there's high volume on weekends and days when volume is low on desktop. So the mobile business complements the core business.
By Joseph Weisenthal