Google Now- makes reality what were adware company’s dreams

We live in the future.

Here are a handful of things that Google Now can do:

  • Favorite sports teams: Your favorite sports teams are tracked at all times. If they are playing, Now will have the game set up as a card for you to follow along with, live.
  • Weather: No matter what your location is, Now knows the weather and displays it for you on a card.
  • Traffic: When you wake up in the morning, Now will tell you how long your commute should take and if an alternate route is recommended. It will do the same when you come home too. It knows when you travel to and from places.
  • Reminders: Now will remind you that you have a meeting along with directions on how to get there.
  • Transit: If you are standing at a public transit station, Now will recognize this and tell you when the next bus or train will arrive.
  • Places: While on the go, Now will recommend bars, restaurants and any other place that it feels you may enjoy.

via Google Now is Awesome. – Droid Life.

Two way to increase ad revenue: increase eCPMs or increase ad impressions

There’s two ways to increase ad revenue: increase effective CPMs or increase ad impressions.

When Andrew Chen met with Facebook back in 2006, that equation is what he used to project the revenue run rate of the social networking company at scale.  The only issue is that his assumptions for number of ad impression was off by several orders of magnitude.

I did a quick calculation:

$0.25 CPM * 5 billion ad impressions per month max?
= $1.25M/month = $15M/year = $150-300M value business?

Which led to his belief that Facebook would not be worth much:

But that meeting opened my eyes and convinced me of a horribly wrong thing: Facebook would never be a billion dollar company.

via Why I doubted Facebook could build a billion dollar business, and what I learned from being horribly wrong | Andrew Chen (@andrewchen).

If you were running an ad network at that time, you would’ve used the same equation and assumptions to judge Facebook.  I did, but I also asked how, if at all, could Facebook increase eCPMs or impressions?

On the eCPM side, search distribution deals, contextual ads, etc. were the only proven methods at that point. On the impressions side, there was no other precedent so I used the range we saw in the Top 20 websites.

Around ’07 or so, I remember MySpace was growing at triple digits and proved that there was some eCPM leverage in their network.  (see here, here, and here).  Still, it felt like those things could only get you to a local maxima for any company in the social networking space.

Facebook felt special enough to be one of a kind but, like Andrew, I doubted it’s upside.  If you were working on the latest online ad tech at that time, you had to if you really believed in what you were doing.