Google 3Q Profits Surge 92%

Another expectation-defying quarter from Google.

Google Inc. reported late Thursday third-quarter profit rose 92% on another strong surge in revenue from the ads it places next to Internet search results. The report sent Google shares climbing in after-hours trading.

The No. 1 search provider said profit for the quarter ended September 30 rose to $733 million, or $2.36 a share, from $381 million, or $1.32 a share, a year ago.

Sales rose 70% to $2.69 billion as more businesses paid to place ads on Google's own sites and those of its partners. Excluding the payments Google makes to acquire Internet traffic, sales rose about 79% to $1.86 billion.

Even so, there will be a group of investors who point to the blowout numbers as proof of a slowdown in Google's core business—online advertising. Instead of growing 96% (as it did between Q3 F04 and Q3 F05), revenues grew only 70%, year-on-year.

We should all have such problems.

I'd especially like the problem of being the #1 US search engine, accounting for half the searches made by people (around twice as many searches as my next-nearest competitor, Yahoo!).

While legacy portals like Yahoo!, MSN, and AOL attempt to build their old businesses based on exclusive content destinations (while simultaneously investing in search), Google's racing past them with the perfect business model in a world of pieces, loosely joined. Google's a destination, but a transient one: it's a broker, a way station, on the road to the information people want. They recognize that, on an ever-expanding network of useful information, their ability to match people and content is far more valuable than any temporary Big Content hookup the portals can arrange with Hollywood.


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Internet Explorer 7 Released

Internet Explorer 7 logo

If you're feeling particularly bold, you can venture over to the Internet Explorer page and download the final release version of Internet Explorer 7, which became available to the general public yesterday afternoon.

Although the Windows machine I have at work is a pretty nice one (developers are assigned machines with the same specs), it's largely relegated to Windows compatibility testing and a teensy bit of .NET development. Since I don't store any crucial files on that machine, I thought it would be the perfect guinea pig on which to test IE7. Over the next few days, I'll report my experiences, complete with screenshots.

Here's a screenshot of IE7 showing the Global Nerdy site. It's still not gettting the CSS layout right; the page is still flush left when it should be centered (Firefox and Safari render it properly).

Screen capture of Internet Explorer 7 displaying the Global Nerdy main page.


Night of the Living Dead Languages

'Jason' from the 'Friday the 13th' movies.

Like “Jason” from the Friday the 13th movies, old but widely-adopted programming languages stubbornly refuse to die, as shown in the ComputerWorld article Cobol Coders: Going, Going, Gone?.

It's counterintuitive in a field like high-tech where “new” is practically synonymous with “cool”, but when it comes to applications, “older” often means “better”. Older applications have the advantage of more real-world use and maintenance, which typically means that more of their design issues and bugs have been worked out.

The drawback is that they've been written in hoary old languages that lack a lot of the programming niceties that we've developed since the 1960s. If you're “lucky”, those niceties have been bolted on in Frankenstein fashion. Ruby and Python developers may turn up their noses at Java and call it “Object-Oriented Cobol”, and they'd probbaly consider working with actual Cobol as akin to coding with stone knives and bearskins.

Nat Torkington at O'Reilly Radar managed to find two humorous footnotes to this situation:

  • 25 years from now, we'll be complaining that nobody under 50 understands all the Java code running banking applications, except possibly all those Indian developers from the offshoring boom (who need the money for Chinese lessons).
  • 5% of the marketplace will say this of the hot language of 2031: “Of course, this was first done more elegantly in Lisp.” We call them weenies.

VCs Don't Want to Pay For Things, Either

In these days of Web 2.0 services that rely on quick customer adoption, the strategy has become so common that VCs have coined a term for it: freemium.

Nothing new here; “give away” the handle to sell the razor blades, etc. Despite the time-tested nature of the strategy, I have no doubt we'll hear how this “freemium” talk signals the peak of a bubble.

One wrinkle I'd like to add. The strategy of having a free, and useful, version complemented by for-pay upsells is far more effective, in my opinion, than offering users time-limited access to the full thing. At the very least, it keeps lightweight, non-paying users around until such time as they need the advanced features of the for-pay versions of the product.

It seems to be working for companies like 37signals.


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A MySpace Page That Doesn't Induce Seizures…

And here I thought all MySpace pages were ugly. I guess in the hands of the right people…


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Your Monoculture or Mine?

Mike "TechCrunch" Arrington uses a minor Google gaffe—a Google employee mistakenly posts a story bound for her personal blog to an official Google blog—to cast a critical eye on Google's security:

Google is pushing full steam ahead with their office strategy, and their hope is to convince a lot of individuals and businesses to trust Google enough to store their documents on Google’s servers instead of their own computers, or servers under their control.

The fact that unauthorized document access is a simple password guess or government “request” away already works against them. But the steady stream of minor security incidents we’ve seen (many very recently) can also hurt Google in the long run. Running applications for businesses is serious stuff, and Google needs to be diligent about security.

I'm not one to downplay security, but some perspective here:. Microsoft has struggled with security, with much broader exposure, for years. And Oracle recently announced patches for 101 vulnerabilities in their products this quarter alone.

Still, a note of caution is appropriate; whenever one vendor's platform dominates, it creates a monoculture that works against security. It wouldn't improve things much to trade a Microsoft monoculture for a Google one.


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