Google Financial Data

Google has a nice table with financial data updated through 2005 in the Investor Relations section of its website.

Google Reports Fourth Quarter 2005 Earnings

Google just reported fourth quarter 2005 earnings. You can read the earnings release here. There is also a PDF version available

Gross revenues slightly beat consensus at $1.919 billion compared to a Reuters consensus of $1.917 billion. Revenues ex Traffic Acquisition Costs (TAC) matched consensus at $1.29 billion versus a First Call consensus of $1.29 billion.

GAAP net income was $372 million or $1.22 per share on a diluted basis.

VoIP Inc. (VOII) signs an agreement with Google

Not really search related, but Google news nevertheless. VoIP Inc. (Ticker:VOII) filed an 8-K with the SEC disclosing that it has signed an agreement to provide Voice over IP (VoIP) services to Google.

From the 8-K,

On September 1, 2005, [VoIP Inc.]'s VoiceOne Communications subsidiary entered into a Master Service Agreement with Google Inc. to supply Voice-over-Internet Protocol ("VOIP") services. The agreement contemplated a period of trial usage to determine compatibility. During October 2005 a series of purchase orders were issued for the interconnection of production of VOIP traffic, and Registrant has now effectuated a direct peering relationship with Google for the transport of such services at multiple locations. Registrant anticipates that material sales of its services will commence during 2006. No material revenues were realized by Registrant under the Agreement during the year ended December 31, 2005.

Microsoft reports lower search revenue in the latest quarter

Buried in the 10-Q that Microsoft filed yesterday is some information on how their search business is doing. Bottom line: Not well.

Microsoft doesn't disclose exactly how money they got from search, but it's clear that search revenue declined year over year. While search volume went up, revenue per search went down dramatically. They attribute the decline to the ramp up of MSN adCenter and lower revenue from text ads from Yahoo! Search Marketing. The transition from Yahoo! to MSN adCenter is going to cause some short term pain.

From Microsoft's 10-Q for the period ending 12/31/05:

Advertising revenue increased $40 million or 12% in the second quarter and $100 million or 16% in the first half of fiscal year 2006 due primarily to growth in display advertising on our portals, channels, email, and messaging services. Display revenue showed over 20% growth in both the three and six months ended December 31, 2005. Search revenue was impacted by an estimated 20% and 17% reduction in Revenue per Search (RPS) during the three and six months ended December 31, 2005. This reduction in RPS resulted from the ramp-up of MSN adCenter and lower than expected performance from partner driven search advertising prices, which was partially offset by low to mid-double digit growth in search volume in the second quarter and the first half of fiscal year 2006.

MSN expects increased growth in our display advertising revenue as the portals, channels, and communications services continue to expand globally and the overall Internet advertising industry continues to expand. However, we expect our overall advertising growth to continue to be tempered by the launch and ramp-up of MSN adCenter and the related pressure on our search advertising prices.

Bear Stearns' speculation on Google Tunes

John Battelle has posted a PDF version of a short Bear Stearns analyst report dated Jan 26, 2006 on his blog. In the report, Bear Stearns Analyst Robert Peck speculates that Google is in the midst of building a music store to compete with Apple's iTunes.

Yahoo! Giving Up?

Some quotes from a Bloomberg article today...

``We don't think it's reasonable to assume we're going to gain a lot of share from Google,'' Chief Financial Officer Susan Decker said in an interview. ``It's not our goal to be No. 1 in Internet search. We would be very happy to maintain our marketshare.''

``It kind of makes you wonder about how serious they are about search,'' said Danny Sullivan, editor of London-based SearchEngineWatch.com, which tracks the search industry. ``It really ought to be their goal'' to be No. 1, he said. ``Whether it's realistic or not.''

``We have held our own and we should gain revenue share in the industry as we roll out these new initiatives,'' Decker said in the telephone interview after the company reported earnings last week. ``Our goal has been to hold our share and to be a leading, if not the leading, total marketing platform, which would include both brand and search.''

Competition for Google in South Korea

This week's BusinessWeek has an article about a South Korean search engine company called NHN. NHN accounted for nearly 40% of online ad revenue in 2005 compared to Google's 2% share of search-related ad revenue. NHN's stock price had a bigger percentage gain in 2005 than Google's.

If you know Korean, try out the search engine at http://www.naver.com.

Yahoo! 4Q2005 Earnings Conference Call Transcript

Seeking Alpha has a full transcript of last night's analyst conference call discussing Yahoo!'s 4th Quarter 2005 earnings.

MSN Search Adds 1 Million Facts

MSN Search's Weblog announced yesterday that their search engine has added about one million facts to their database. MSN Search will now give you direct answers to topics such as baseball stats, football stats, weather facts, names of world government officials, and holiday information.

Thomas Weisel Partner's Internet Monthly

John Battelle has posted a PDF version of Tomas Weisel Partner's Internet Monthly on his blog. This is a 65 page report covering internet trends.

Google to Acquire dMarc Broadcasting

From the press release:

MOUNTAIN VIEW, Calif.--(BUSINESS WIRE)--Jan. 17, 2006--Google Inc. (NASDAQ:GOOG - News) today announced it has agreed to acquire dMarc Broadcasting, Inc., a Newport Beach, Calif.-based digital solutions provider for the radio broadcast industry.

dMarc connects advertisers directly to radio stations through its automated advertising platform. The platform simplifies the sales process, scheduling, delivery and reporting of radio advertising, enabling advertisers to more efficiently purchase and track their campaigns. For broadcasters, dMarc's technology automatically schedules and places advertising, helping to increase revenue and decrease the costs associated with processing advertisements.

In the future, Google plans to integrate dMarc technology into the Google AdWords platform, creating a new radio ad distribution channel for Google advertisers.

"Google is committed to exploring new ways to extend targeted, measurable advertising to other forms of media," said Tim Armstrong, vice president of Advertising Sales, Google. "We anticipate that this acquisition will bring new ad dollars and accountability to radio by combining Google's expansive network of advertisers with dMarc's talented team and innovative radio advertising technology. We look forward to working together to continue to grow and improve the ecosystem of the radio industry."

"We are excited to be joining one of the most innovative companies in the world," said Chad Steelberg, CEO of dMarc Broadcasting, Inc. "We are bringing together complementary visions of
simplicity, efficiency, and accountability to the radio advertising process."

dMarc customers will not experience any interruption in service. For more information on dMarc Broadcasting, please visit www.dmarc.net.

Transaction and Financial Information

Under the terms of the merger agreement, Google will acquire all of the outstanding equity interests in dMarc, a privately held company, for total up-front consideration of $102 million in cash. In addition, Google will be obligated to make additional contingent cash payments from time to time if certain product integration, net revenue and advertising inventory targets are met over the next three years. The maximum amount of potential contingent payments is $1.136 billion over the next three years. Since these contingent payments are based on the achievement of performance targets, actual payments may be substantially lower. The acquisition is subject to customary closing conditions. Google anticipates that the acquisition will close in the first quarter 2006. Substantially all of the payments will be accounted for as part of the purchase price for the transaction.

Larry Page in the spotlight

There is a nice article about Larry Page and Google in this week's Economist magazine titled St. Lawrence of Google.

You can also view or read a transcript of Larry Page's keynote address of the 2006 CES at a new addition to the Press section of Google website called Google Podium. You can find transcripts and webcasts of many presentation from Google employees at Google Podium. Hopefully, they will keep this up to date with every public presentation from Google.

Yahoo! to Announce Fourth Quarter Earnings on Jan 17th

Yahoo! will announce 4Q 2005 financial results on Tuesday, January 17, 2006 after the stock market closes. The earnings conference call will be at 5:00 PM ET/2:00 PM PT.

A live webcast of the conference call can be accessed at http://yhoo.client.shareholder.com/earnings.cfm.

Google begins to monetize Google Maps

Google has quietly introduced Sponsored Links within Google Maps. If you do a search for hotels in New York on Google Local, you will see some results with blue balloons that are paid results as opposed to organic.

This seems to be in a testing phase because these links aren't widespread on Google Maps, and Google hasn't publicly told advertisers how to pay for placement on Google Maps.

This was first reported by David Galbraith.

Google Upgrades the Mini

Today is the one year anniversary of the Google Mini, a hardware product from Google which enables organizations to search their internal network. The original Google Mini can index up to 100,000 documents and costs $2,995. Today Google has introduced a version that can index 200,000 documents for $5,995 and version that can index 300,000 documents for $8,995. Previously, customers had to spend $30,000 for the full Google Search Appliance, if they needed searching capacity beyond 100,000 documents.

Apparently the Google Mini is selling well, from Forbes.com:

"The Mini has been a success beyond what we could have imagined," said Rajen Sheph, product manager of Google's enterprise division. "Thousands of customers have already deployed it and it has a kind of appeal that we wouldn't have anticipated."

Google Local now available on Blackberry devices

Blackberry and Google announced this morning that Google Local is now available on the Blackberry wireless platform.

Google Local for mobile enables BlackBerry users to view maps and satellite imagery, find local businesses and get driving directions on their BlackBerry handsets. Google Local for mobile provides draggable maps, directions and imagery, as well as a "click to call" feature. Google Local for mobile will store any addresses you have typed in or used for directions for quick and access to previous locations. The satellite imagery viewing of Google Local for mobile allows users to zoom in on an image for a closer look at the terrain, zoom out for a grander perspective, or move the map in any direction. This interactive satellite view gives you a chance to explore and evaluate your locations in far greater detail.

Google Local for mobile is available for download for free at www.google.com/glm.

Also announced was that Google Talk will be available for Blackberry this spring.

Google to Announce Fourth Quarter Earnings on Jan. 31

Google will announce 4Q 2005 financial results on Tuesday, January 31, 2006 after the stock market closes. The earnings conference call will be at 4:30 PM ET/1:30 PM PT.

A live webcast of the conference call can be accessed at http://investor.google.com/webcast.

Google Earth for Macintosh now available

Google Earth is now available for the the Mac. Download it here.

On a related note, the PC version of Google Earth is now officially out of beta.

Google Video Store now open for business

Google's new Video Store is now open for business. Users can now download paid content by paying via credit card.

Check out Google's Official Blog for a full list of paid content providers.

Time Warner gets $300 million Google promotional credits

From Reuters, Time Warner has publicly acknowledged that it's getting $300 million in advertising credits as part of Google's deal to purchase a 5% stake in AOL.

AOL still has to participate in Google's AdWords auction system to show its ads, but now they get $300 million in free money. This should make it more expensive for existing Google advertisers, as they now have to compete with this "new money" in the system.

AOL Acquires Truveo

AOL announced this morning that it acquired Truveo on Dec. 22, 2005. Truveo is a video search engine company. AOL will integrate Truveo into its existing video search offerings.

Google acquires Reqwireless

Via Search Engine Watch, Google has acquired Reqwireless, a Canadian wireless software company. While the acquisition was made this past summer, it was only recently disclosed by Google. The National Post has an article about it, Waterloo gets Googled.

This is yet another step into the world of wireless software following Google's acquisition of Android.com.

Google enters a new line of business

With Friday's announcement of the Google Video Store and Google Pack, Google officially entered a new line of business: distribution of digital content. While these two new products may seem very dissimilar, the thing they have in common is that they both involve the distribution of digital content. The Google Video Store connects video content owners with consumers, while Google Pack is a mechanism for software to be installed on Windows PCs.

Right now, 99% of Google's revenue comes advertising. The other 1% comes from selling hardware (such as the Google Search Appliance), software (such as Google Earth), and miscellaneous service fees. Once the Google Video Store goes live, Google will now get a distribution fee for connecting digital content providers to end users. Google Video has the potential to be a powerful gatekeeper for the distribution of video content. The initial split of revenue will reportedly be about 70/30 with 70% going to the content owner. Also, the content owner will ability to set their own price. This large split and pricing flexibility give a strong incentive for owners to make their content available on Google Video. Google will gladly take 30% of something rather than 100% of nothing. Especially if that 30% grows very large.

Although Google Pack is free to the end user, it too involves distribution. The foundation of Google Pack is Google Updater. This makes it easy for the user to download, install, and keep up to date a suite of software products. Going forward Google can simply add a new program to the suite on their server, and every user of Google Updater will have a copy downloaded to their computer.

We'll see how big this new business will be...

Google unveils Google Pack

Google officially announced the release of Google Pack Friday evening at CES. Google Pack is a collection of useful, free software from Google and select third parties. It is essentially a installer program which gives the user a single interface to download and keep up to date a collection of software.
The primary benefit to Google is that it is efficient distribution mechanism to get its software on Windows PCs. Now when Google releases a new program or an update, Google Pack will ensure that users get the new program or update. The real benefit will be felt when PC manufacturers start preinstalling Google Pack on new PCs. Imagine getting a brand new PC and easily installing the whole suite of Google products.

You can download Google Pack at http://pack.google.com.

Read more about the reasoning behind Google Pack from the Official Google Blog.