He thinks Google is unlikely to invest much in enterprise applications, because profit per employee is much lower than in its advertisement-financed consumer business.
I know this isn't the article's centre of gravity, but...
It bugs me to hear this thrown around so easily. There is no existing business model that produces that type of cash from online advertising. Search is the exception. Not the rule. Google's hedging bets, tying their hands but at the end of the day, these free web services will either need to be:
1. subsidised by a giant (like google does now) for whatever reasons they can get together
2. very cheap to run. IE web-services will replace companies many times their size, taking only a fraction over the revenues. You can always get some revenue from ads.
3. paid for by users
4. a business model will emerge that will do for apps what overture/adwords did for search.
I wouldn't be putting all my shells on 4. Unless i'm missing something.
Gmail is probably one of the 'best-bet' ad-supported apps. If it was a yearbook, they might get 'most likely to succeed' Anyone have an idea how much they make?
I know this isn't the article's centre of gravity, but...
It bugs me to hear this thrown around so easily. There is no existing business model that produces that type of cash from online advertising. Search is the exception. Not the rule. Google's hedging bets, tying their hands but at the end of the day, these free web services will either need to be:
1. subsidised by a giant (like google does now) for whatever reasons they can get together
2. very cheap to run. IE web-services will replace companies many times their size, taking only a fraction over the revenues. You can always get some revenue from ads.
3. paid for by users
4. a business model will emerge that will do for apps what overture/adwords did for search.
I wouldn't be putting all my shells on 4. Unless i'm missing something.
Gmail is probably one of the 'best-bet' ad-supported apps. If it was a yearbook, they might get 'most likely to succeed' Anyone have an idea how much they make?