Google Trading Portal Services For Ad Inventory

from the portal-deals-again dept

Wed, Dec 6th 2006 10:41am — Joseph Weisenthal

Back when Yahoo was the hot internet company, it made a number of deals with ISPs to offer co-branded internet access. Now that Google has taken Yahoo's mantle, it looks like similar hookups with ISPs may be in the works. Today the company announced an agreement (via EuroTelcoblog) with UK operator BSkyB to co-deliver a range of services to BSkyB customers. For the most part, it doesn't look particularly exciting. The companies will work together to deliver VoIP and video services, while Google will assume control of the advertising on BSkyB web properties; it seems safe to assume that the advertising is the core of the deal, since that's where the money is for now. As for the other stuff, like video and VoIP, anyone with an internet connection can already get those things whether their ISP has signed a deal or not. BSkyB will be able to use these services to make its cheap, no-frills broadband offering more attractive, and they're what Google's given in trade to be able to lock down the ad inventory of Sky's web properties. That's the real value here for Google -- the ability to sell that ad space, not the extra users of its services it might gain. Therein lies the difference between this deal and the deals involving Yahoo. It's not about licensing the Google brand name or driving users to its services, it's about offering those services in exchange for access to ad space. Google's made similar moves before (deals with Dell, Firefox and Opera being the most prominent) , and will continue to try to sew up market share wherever it can. But it's not just interested in growing the market share of its services like Gmail in these deals, it's interested in grabbing a bigger share of the online ad market.

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Adam Lea, 6 Dec 2006 @ 11:18am

Hmmm
One has to wonder how these deals will pan out in the long run. Many similar deals struck by Yahoo in it's hey days turned into nothing really more than big yawn fests that did little to generate much income for either party.

As mentioned, VoIP and the other services are already widely available via other avenues....

I don't know much about BSkyB, but I assume that it's user base is large enough to justify such a move by Google...
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Jamie, 6 Dec 2006 @ 11:40am

Google focuses on expanding core
I like the way Google always has its eye on expanding its core business. Google seems to remember in all its business dealings that the purpose is to expand its money maker, selling ads. They don't get caught up in trying to dominate the market on any of their offerings. I remember the whole IM war that AOL, Yahoo, and MS fought. It didn't really gain any of them much of anything. Contrast that with Google Talk. Google doesn't really care that much that it doesn't dominate. Talk is nothing but another feature to drive ad sales. If it doesn't drive enough ad sales, then Google will simply try something else. They don’t care that they don’t dominate the IM market, because they aren’t in the IM business. They are in the ad business. Google doesn't seem to forget that the offerings are only there to drive traffic towards the core business.
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- Lucas McDonnell, 6 Dec 2006 @ 2:03pm
  
  Re: Google focuses on expanding core
  Good point Jamie. Google's always been very smart about taking something stale and turning that into ad revenue.
  
  Competition between IM clients is another interesting point to bring up. While Google's IM client is certainly not the most widely used, it's certainly the least annoying in terms of advertising. While MSN Messenger is very popular, I would say it's popular despiteit's annoying advertising.
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rijit (profile), 6 Dec 2006 @ 11:49am

BSkyB
From what I have read, and numbers are kind of sketchy, but it looks like BSkyB has about 74,000-100,000 users signed for this service.
More here: http://www.forbes.com/markets/feeds/afx/2006/12/06/afx3232444.html
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rijit (profile), 6 Dec 2006 @ 11:53am

RE: BSkyB
Oh, sorry, 74,000 signed up for BSkyB service last October, according to the article.
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|333173|3|_||3, 6 Dec 2006 @ 7:05pm

and all this links in with youtube
YouTube has a massive collection of searchable files, the organisation of which is something Google is good at. They also have enough R&D capital to invest in finding better ways of advertising based on file content. The question is, how long it takes for Google to come up with a non-annoying way to advertise on VOIP.
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rishi, 7 Dec 2006 @ 10:05pm

While a few posts below you hear of other companies abandoning their core business to be more like each other, it is refreshing to see that Google is making deals to further it's core business even though it has such a commanding market share.
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