How Google Makes Money

How Google Makes Money

Google is our popular search engine, email service, web browser and for various tasks we use every day at work, at home and on the go. What many people don't think about day-to-day is that all these services are free. How does Google make money?

According to the parent agency Alphabet (Jigool) 's website, Q4 2019 reported earnings of 46 46.075 billion, which includes "the numbers include October to December and the busy holiday shopping season for Google's hardware efforts."

Google ads and search ads
Most of Google's ২ 122 billion revenue in 2012 came from its proprietary advertising service, Google Advertising.

When you use Google to search for anything from financial information to local weather, you'll be given a list of search results generated by Google's algorithm. The algorithm tries to provide the most relevant results for your query and with these results you can find suggested pages related to any Google Advertisers.

Key Takeaways
Google's AdSense program allows websites that are not authorized with Google to use Google Display Ads on their sites.
A large portion of Google's revenue comes from advertising.
Google makes money on cloud-related businesses such as the Google Cloud platform.
Advertisers need to outdo each other in order to top Google ads. High bids move up the list while low bids may not appear.

Advertisers pay Google every time they click on an ad. Prices can range from a few cents to over আর্থ 50 for highly competitive search terms, including insurance, loans and other financial services.

The integration of Google AdWords ads touches almost all of Google's web features. Any of the suggested websites you visit while logging in to Gmail, YouTube, Google Maps and other Google sites are generated through the advertising platform.

AdSense Network
In addition to featuring search ads on its site, Google's AdSense program enables non-Google websites to include Google Display ads on their pages. AdSense ads work similarly to Google's onsite ads but appear on Google-approved sites somewhere on the Internet.

When a member clicks on an ad on a website, a portion of the revenue that Google retains is paid to the site owner. Because of the breadth of companies advertising through networks, the whole business relies on AdSense as their primary source of revenue.

Other revenue
The rest of Google's 2019 revenue comes from a collection of non-advertising related projects. These initiatives include a number of different business projects, both online and offline.

The list of "other earnings" includes revenue from related online, media and cloud computing businesses such as Play Store, Chromecast, Chromebooks, Android, Google Apps and Google Cloud Platform.

Past offline projects include Google’s famous self-driving car, Google Glass and an investment in a solar power plant in the Mojave Desert. Analysts have criticized Google's investment in these projects, as increased costs from the non-core business cut into profit margins for the entire company.

Major Mistap: Motorola Mobility
Just because Google’s advertising business is a cash cow of earnings doesn’t mean the company isn’t flawed. Google's biggest financial mistake in recent years was the $ 12.5 billion purchase of Motorola Mobility in 2011.

As of January 2011, Google has become the owner of the world's leading smartphone platform for the success of its Android operating system. Although Google has already entered the mobile market as a software vendor, the company has staked লা 13 billion for Motorola mobility. Google believed it could grow the Motorola handset business through a natural coordination with the Android software development team.

The deal has become the biggest flop in Google's history. According to media reports, Lenovo bought Motorola Mobility from Google for ৯ 2.9 billion just two years after its acquisition, leading to a big 6 6.6.6 billion downturn. In an effort to do so, Google retains ownership of the lion's share of the 17,000 patents it has acquired.

Bottom line
In 2019, Google was up 18% year-over-year and 20% higher on a fixed currency basis, according to data released by Alphabet and Google’s chief financial officer Ruth Porat.

Other business departments contribute billions to Google's revenue each year, with Google making the most money from online advertising. Despite the company's investment in other ventures, the technology giant's presence in online advertising spaces does not appear to be changing anytime soon, nor does its strong revenue growth.