Google’s unbeatable lead over rivals

Google’s unbeatable lead over rivals
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First Published: Sat, Apr 19 2008. 12 03 AM IST
Updated: Sat, Apr 19 2008. 12 03 AM IST
Google’s sparkling results overseas have dimmed concerns of an economic slowdown. For the first time, more than half of revenues now come from outside the US. Sure, a weaker dollar helps. Google estimates it provided a $200million (Rs800 crore) bump. Take this out, and foreign sales are still growing more then 10 percentage points faster. Overseas markets are simply at an earlier stage of development, so they have quite a ways to go until they catch up.
Moreover, the company’s market share overseas is higher than it is in the US, and so profitability should be higher. More than 80% of searches in the UK, for example, were on Google. It is using this advantage to try and knock out competitors.
Three months of data doesn’t prove Google is home free. It gets paid when people click on its ads, and only 4% more clicked in the first quarter than in the fourth quarter. The company’s 42% revenue growth may prove the link between revenue and clicks is weak. Or it may just be a leading indicator of future problems in this still new business. But Google’s market share continues to rise and rise. Its lead on competitors looks increasingly insurmountable.
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First Published: Sat, Apr 19 2008. 12 03 AM IST
More Topics: Google | Revenue | Money Matters | Equities |