Google’s Secret billion dollar revenue stream.

Ever wonder how Ask Jeeves ACTUALLY makes money?   Well they do it via the massive adware/toolbar/mysearch install more commonly known as smileycentral.com.  If you read through this articleon ask jeeves acquisition of Myway, mysearch.com etc  you will see that it doubled their market reach in search and revenues.   This means ~30- 50% of Ask Jeeves current revenues are tied to adware/smilie/toolbar installs among other things.  

Its easy to detect if users have this installed as the user agent is changed to funwebproducts.   For plentyoffish visitors from the USA, there is a 13% chance that your computer is infected.  About a year ago smilecental  reached 11% of US traffic.

As you may guess installing toolbars on peoples machines by sneaking them in somehow is insanely profitable.   These companies are earning well over $20.00 per toolbar user per year. Google says they earn an average of $16.00 per user,  but a toolbar users tends to be double the average as they are regular users not casual users.  

Toolbars are the major battlefield that NO one wants to talk about.  Everything being done today by Microsoft, Yahoo and Google is to get their toolbars on peoples machines.  Google did a deal with Sun, Dell and firefox to push their toolbars.   From the above news release  I suspect Ask.com is currently getting ~30-50% of its revenues from its toolbars, Microsoft, Yahoo and Google are probably at 20%+ of revenues.   

The longer Microsoft delays windows vista the larger Googles toolbar install base becomes and the more google is dependent on toolbar revenues.    When windows vista launches googles toolbar install base will vanish somewhat and with it a large part of its revenues. 

The real question is when is Myspace going to stop screwing around and create custom toolbars for its users?   Considering that myspace was born in the “dark side” of the web, it should be a no brainer for them?

45 Responses to “Google’s Secret billion dollar revenue stream.”

  1. Dellbuyer Says:

    I bought a laptop that came with all the google stuff on it. It is a nightmare. I must have wasted half a day trying to get rid of it and actually broke my copy of IE by hacking away at the registry and had to re-install the operating system because on my machine the homepage was LOCKED to the dell/google and it was impossible to reset.

    Makes me a) hate google and b) not want to buy dell again.

    There should be an option during checkout to not have all this crap installed.

  2. Ionut Alex. Chitu Says:

    You can also install Firefox ( http://www.mozilla.com ) and set another homepage. I think it’s Dell’s fault: Google usually gives options to the users.

    Another idea is to edit the HOSTS file
    c:\windows\system32\drivers\etc\HOSTS
    append this line
    http://www.myhomepage.com http://www.google.com/ig/dell
    (replace http://www.myhomepage.com with your homepage)

  3. MT Says:

    Google has to be making money off the integrated search in Firefox, since the Mozilla is making tens of millions of dollars off of it.

    http://www.FirefoxMyths.com

  4. Brad Says:

    Markus,

    You stole my blog post since we chatted of MSN! haha. I will write one soon as well. Great to see someone explaining MSFT infrastructure and delays.

    Search is not a web destination, its a core software application people need on their computers to find data. Search engines are the first main stream thin client software application.

    Great post. I will follow soon.

    Brad

  5. Gopi Says:

    One good thing for microsoft with the vista delay is they now have some time to improve their core search product…If they succeed in making it somewhat decent (if not better than google), i think the coming vista/IE 7 search box will atleast double their search marketshare in the next 3 years.

    I think a better bet for them would be to merge with yahoo and promote yahoo’s search brand thro the search bar without any msn branding….

  6. James J. Says:

    Myspace not yet offering a toolbar is a good point, Markus. As you said, considering how they came about, you would think it would have been something they would have offered from the beginning. There must be some good reason. There is the possible negative attention that could come from it, but that hasn’t stopped anyone else.

  7. Tom Says:

    Sorry for my ignorance, why myspace would have offered toolbar from the begining? What is the history here?

  8. Michael Webster Says:

    Recently, Google tried to sue MSFT for violating the anti-trust agreement with government on this very issue of bundling the toolbar. More evidence of the importance of this issue – lawsuit was tossed, however.

  9. vomo Says:

    Great post. Will trackback from my blog. If toolbar is a battlefield that nobody is talking about… I wonder how many of them out there are concieving more toolbars? Even better, we should be seeing collaborative toolbars that go beyond search and the nifty tools that they come with these days. Are we seeing something akin to the browser market being created right now?

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