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How Google News makes $100 million

July 29, 2008


Business Vicky Lalwani 1 Comment

We all know about Google News, surely most of us have used it at least once. So the question is – how does Google monetise from it?

From a new article that was on Google News, I recently read that Marissa Mayer (Vice President Search Product and User Experience, Google – pictured) stated that Google News generates US$100 million in revenue.

I scratched my head going – “A hundred mil? How?”

Surely she had accidently slipped her tongue with that figure. Google simply directs any one who clicks on a new link straight through to news publisher’s site.

Also the News section is an ad-free area so Google isn’t making any ad-revenue which the company is ever so famous of normally doing.

But then I used Google’s search engine to begin my research – I found this – http://bigtech.blogs.fortune.cnn.com/2008/07/22/whats-google-news-worth-100-million/

The figure comes from a referral technique, where it is assumed that Google News funnels readers to the main Google search site. So while we don’t realise this, it’s one way of Google’s free service, that somehow in the background makes money.

And this article is a perfect example. I read about the news headline at Google News (an ad-free environment) and it took me to Forbes. I read the article there, but I was intrigued. So what did I do, I went to Google search to get my research results (an ad-full environment).

This sort of ad-free service at one side to somehow lead us to the opposite end with ads, is a how Google News makes it’s US$100 million revenue referral.

So if Google is making $100 million from its News service, will the news publishers ask for that extra bit of cash? Clearly they already get traffic from users through Google, but if it wasn’t for them, Google wouldn’t have had the content in first place.

The same will come about when Google launches it’s digital consumer health records, a service that allows people to store and access their medical records online. At first there were thoughts of having ads around this service – but it was later decided that they are better off. This is because Google is hoping that the Google News strategy flows through – where it assumes that someone using Google to store medical records, will likely use Google Search when it comes to finding medication, doctors, hospitals or even to just general research.

The above almost defines the Google ecosystem.

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