Sunday, October 22, 2006

Google vs Yahoo

These two words are, I am sure, among the most popular across the world. So how the two companies are doing should also be of interest to the world. The battle between the two pioneer Internet search engines continues; and has also got a bit interesting. (The two have today diversified into many other fields, particularly to mail.)

Their third quarter figures were out a few days back. Google showed a 70% increase in
revenue earnings compared to the same period a year back; while Yahoo's corresponding revenues marked a 19% increase. The net profit of Google increased 92% while that of Yahoo fell 19%.

The performance of Google and Yahoo has to be viewed against the
performance of major newspaper companies in the US. Tribune reported a 2% drop in publishing ad revenue, The New York Times reported a 4.2% drop, and Belo, which publishes the Dallas Morning News and the Providence Journal, reported a 5.5% slide.

Unlike any other product, the main revenue of a media organisation is through advertisements rather than through the selling price. In fact, journals are the only product that is sold at a far less price than what it costs to produce.

The healthy growth of the online publications is very significant: because one view often heard was that companies would prefer to give advertisements to print journals rather than to online journals; which means, print journals will survive while online journals will struggle. But the figures above seem to indicate the opposite.

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