Google's Black Box

Friday, April 18, 2008 | 10:00 AM

My friend Paul asks, "Why Was Everyone Wrong-sided on Google?"

I am not sure, but an anonymous emailer has a theory.  He notes that like GE Google (GOOG) also has their own form of a Black Box. Its the magic in between Google AdWords and Google AdSense.

"Stupid bloggers have no idea what they are getting paid for their Google ads. What is the CPM? You don't know. That gives Google a tremendous financial flexibility to "adjust" the payout on the fly to make up any revenue shortfall."

That all might be true -- it could account for some of the 42% revenue growth -- but it doesn't explain how Google managed a 20% click through rate on ads.

Question: Can (and does) Google change the rates they pay to meet their quarterly numbers?


Kryptonite Caused GE's Miss

Friday, April 18, 2008 | 10:00 AM | Permalink | Comments (47) | TrackBack (0) add to | digg digg this! | technorati add to technorati | email email this post



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The boys at Google are shrewd beyond belief...low-balled their IPO back in 2004, so they could award themselves boatloads of dirt cheap stock options. Remember when it came out...the media panned it, saying there was no info in the filings to warrant more than 100 in the Dutch auction. Came out at 85 and they got huge grants with strikes in the low 100s in late 2004. Now execs are cashing them out everyday.

Posted by: Steve Barry | Apr 18, 2008 10:03:36 AM

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