Will Google Renew Ad Deal With Ask.com?
Oct 9, 2007 at 8:57am ET by Barry Schwartz
Ask.com Ad Pact With Google Ends Soon from CNNMoney.com covers how the deal for Ask.com to carry Google’s paid listings expires at the end of this year and suggests Ask.com has more to lose than Google by not renewing it. Let’s break down some of those numbers from the story:
In the second quarter, Google earned $997 million from ads on “partner sites.” Barry Diller of IACI said that his Ask.com accounted for 10% of Google’s partner site revenue. That means Ask.com should have brought in almost $100 million of that for Google.
Google’s own properties earned them $1.43 billion. That is a small fraction of the revenue Google earned from their ads that quarter. Now, if Google shares 80 to 85% of that revenue with Ask.com, that is not much overall profit from that partnership.
Youssef Squali, an analyst at Jefferies, said “If it’s [Ask.com's] more than 1% [of Google's total ad revenue] I would be shocked.”
Postscript From Danny: I’d expect Google to strongly work to keep the partnership with Ask, if only to prevent Yahoo and Microsoft from picking up the recognition of powering paid listings on an important site like that. Google may be big, but winning paid search syndication partners is still important and a competitive space.
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