Groupon is Google’s $6 billion Facebook hedge

Why is Google willing to spend over $6 billion for Groupon? The local advertising market is massive — yellow pages ads still bring in more revenue than Google’s annual revenue. Local has been an extremely difficult market for online ad solutions to capture. Consider how a yoga studio in Cleveland can advertise. With Google AdWords, the yoga studio can target people searching for the keyword “yoga”, but this is an expensive, nationally bid-up keyword, and not a word the people search every day. Adsense provides a bit more context, and the ad could be placed in websites that talk about yoga, but there aren’t that many people looking at pages like that to click on the ad. Google Maps lets the yoga studio ad coupons to its location, but it has not had much uptake. The incredibly large local ad market has remained primarily elusive to Google, to the point where it considered purchasing Yelp for a large sum even though it did not have that much local ad revenue.

Why did Google disclose AdSense numbers everyone already knew?

For years, online publishers have known that if you dig through Google’s financial statements, you can calculate that the company’s AdSense system, which serves ads to other sites and splits the revenue from advertisers with them, pays about 70 percent of the money it collects from advertisers to publishers who run the ads.

Using AdSense to cash in on the iPhone

It was only a matter of time, I suppose. Google, to no one’s real surprise, has tied its AdSense cash machine to the mobile applications market.