Google's Low Margin One Stop Ad Shop Thang

andreina 02
Originally uploaded by photochino`s.

Andreina agrees with The Internet Outsider on Google's want to be the middle man for print and radio advertising, among others, may be somewhat vertically challenged in the short term : "At an 11% operating margin, for Google to generate an incremental 10% of operating profit per year from its new radio and print business ($260 million, if we annualize Q4 operating profit), it would need to generate an estimated $2.4 billion of radio/print revenue per year (more if the operating margin is actually lower, which it probably is). To put this in perspective, this is closing in on as much revenue as Google currently generates in its Networks business ($3.2 billion annualized) after several years of growth with a dominant industry position. It is also approximately a quarter as much revenue as Time Warner (print) and Clear Channel (radio) generate in their print and radio businesses combined, after more than half a century of growth."