When a user clicks on an ad on your site you receive a certain amount of money. This amount is based off of how much an advertiser bid for the keyword, but how much of what the advertiser bid do you get and how much does Google receive? What's the cut? This amount has been speculated about for years and Google has never disclosed the amount.
Now there is a New York Times article out today that claims that Google takes 21.5 cents on the dollar or 21.5%
Google.com and the company's foreign search sites contribute more to Google's bottom line than AdSense, because for every dollar the company brings in through AdSense and other places that distribute its ads, it pays roughly 78.5 cents back to sites like Digital Point that display the ads.
This figure seems to be on the high end by most commenting around the web and they figure that Google takes even more.
How did the reporter derive this number? Well Microblogger actually emailed the New York Times and asked:
I emailed Bob Tedeschi (author of the article) about where he got the numbers and he said that he gleaned the figures from Google’s 10-Q. Of $675M in revenues from the Google Network, they paid out 78.5%, or $530M. Then he mentioned that the company emphasized that 78.5% is an average payback… so each publisher gets more or less than that (smart pricing?).
Me personally, I have no clue, but I'm willing to share with Google for all that they provide me. The ease of use, the reporting, all of the back-end -- for making sure the ads are relative and the highest earning -- and all of the costs of doing business when it comes to the ads, are covered by Google. I don't suffer any charge-backs, credit card processing fees or transaction costs for Electronic Funds Transfer and I like it that way.
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Posted on Mon Jan 16, 2006 at 09:12 PM | Permalink | Email This | Blogroll IOA! |