Читать книгу The Digital Economy - Tim Jordan - Страница 12

Let me start with wealth. In the first three months of 2018, Google¹ had a total income of 31.1 billion US dollars (a 26 per cent increase compared to the first three months of 2017), 85 per cent of which, or $26.6 billion, was brought in by advertising. In the same period Google’s net income, or profit, was $9.4 billion (Alphabet Inc. 2018b). In the second three months of 2018, the company’s total income was $32.7 billion, advertising brought in $28 billion (86 per cent), and net income was $3.1 billion (or $8.2 billion excluding fines) (Alphabet Inc. 2018a). A surplus or profit of $12.5 billion in six months is wealth.

Google’s profit has always been dependent on revenue from advertising that is driven from its search engine. Formed in 1998, the company began as a website with one feature, its search engine. The first ever Google webpage was just the name Google and a box in which a search query could be entered. Its distinctive search capabilities attracted the attention of investors, who funded its losses in the early years. In 2000 Google lost $14.1 million, double its previous year’s losses, but was soon to launch an advertising program called ‘Adwords’. In 2001 the company showed a profit of $7 million, its first ever profit, rising to $100 million the following year, and then steadily upward to a yearly profit $19.5 billion in 2016, $12.6 billion in 2017, and $12.5 billion in the first half of 2018 (Auletta 2011; Levy 2011; Alphabet Inc. 2017).

Such figures sometimes lead to the judgement that ‘Google is an advertising company’, but while the source of revenue and profit is undeniable, advertising hardly defines Google’s economic practice. It is also not alone as a search engine – before it were Alta Vista, Ask Jeeves and others, alongside it are Baidu, Bing, DuckDuckGo, Mojeek and others. Google is also not alone in monetising a service through advertising – Facebook, many computer games, web portals and other sites also take this route. While there are other search engines and other online advertisers, in examining a specific digital economic practice it helps to focus on just one, and it makes sense to start with Google given its position as a pioneer of online advertising and one of the largest profit-generators in the digital economy.

Following an examination of Google’s economic practice, this chapter will pursue two directions. First, Google’s economic practice will be abstracted to try to identify its key elements. Particular attention will be paid to its digital elements – those which might signify a specifically digital economic practice – and to how this practice might have a possible wider applicability. Second, I will explore whether Google’s practice can be applied to or found in other search engine companies.