Google winning 98% ad spots it auctions off, after order to treat others equally • Hacker News Board

Re: Google winning 98% ad spots it auctions off, after order to treat others equally

#61

Post by londons_explore » Wed, Jan 31, 2018, 12:39 AM UTC

NelsonMinar wrote: post #37

It's kind of a clever solution by Google, if a bit troll. They can make that ad auction 100% fair and still win it because they have more expertise on running efficient ad campaigns than anyone. IMHO that just doubles down on the danger of their monopoly power, but perhaps it complies with the antitrust requirements.

Most importantly they have more information about each auction than their competitors.

They know for each user every other search result clicked. They know what the users interests are. They know which users prefer stuff delivered fast, which prefer the cheapest items, and which will be wooed by 50% off deals.

They can use that data to present the best possible results, get the highest click through rate, and sell the most products.

Therefore they can afford to pay more for the ad spots than someone without that data, who gets less precisely targeted ads, and fewer product sales per advertisement shown.

Re: Google winning 98% ad spots it auctions off, after order to treat others equally

#62

Post by freehunter » Wed, Jan 31, 2018, 12:39 AM UTC

dsacco wrote: post #48

sqdbps wrote: post #22

Earlier quoted context omitted.

>This is pure bullshit, and bullshit journalism. It's the "Wall Street Journal", a Murdoch business publication that approves of every business as long as it isn't Google.

> It's the "Wall Street Journal", a Murdoch business publication that approves of every business as long as it isn't Google. Please don't bring politics into this. If you have a substantive criticism about the WSJ's article, make that criticism. The one you've made is ideological and unpersuasive.

Mentioning the name of a business leader (not a politician) in the context of his business dealings (not his political views) is, by definition, not bringing politics into it.

You're the one who brought up politics in a decidedly non-political conversation.

Re: Google winning 98% ad spots it auctions off, after order to treat others equally

#63

Post by londons_explore » Wed, Jan 31, 2018, 12:41 AM UTC

zitterbewegung wrote: post #7

Which is more expensive. The new system that google is designing? The fine that they will have to pay? Or the oversight they will have to have to comply with EU law? (or some combination of the previous?). On the other hand could Google just quit putting ads on requests from the EU?

The system is cheap (it cost ~$15M of compute resources and $5M of engineering time).

The fine is much larger.

The oversight costs nothing now, but they're worried it might prevent them innovating in the future (as happened with Google Books)

Re: Google winning 98% ad spots it auctions off, after order to treat others equally

#64

Post by ucaetano » Wed, Jan 31, 2018, 12:49 AM UTC

ameister14 wrote: post #44

ucaetano wrote: post #43

Earlier quoted context omitted.

From your "source": > In November 2008, Kelkoo was sold by Yahoo! Inc to the private equity firm Jamplant Ltd. The current CEO has been there since 2009, shortly after the acquisition. Jamplant was incorporated in October of 2008, one month before the acquisition. The director was Andrew Simon Davis, who is frequently listed as a director of shell companies and trusts. In the same month he was appointed director to d…

>The Kelkoo Group is based out of the same office as Jamplant, along with dozens of other companies, what indicates a virtual office or company registration service. That office is 300k sqft of 'flexible office space.'

Not just the same address, but the same floor.

Re: Google winning 98% ad spots it auctions off, after order to treat others equally

#65

Post by [deleted] » Wed, Jan 31, 2018, 1:39 AM UTC

ojbyrne wrote: post #38

115100 wrote: post #34

Earlier quoted context omitted.

It took less than 30 seconds to find out that they're not. https://www.ft.com/content/4044d354-b825-11dd-ac6d-0000779fd...

Do you have a citation that's not behind a paywall? Crunchbase says they were acquired by Yahoo. https://www.crunchbase.com/organization/kelkoo

[deleted]

Re: Google winning 98% ad spots it auctions off, after order to treat others equally

#66

Post by Pxtl » Wed, Jan 31, 2018, 1:44 AM UTC

dsacco wrote: post #58

jacksmith21006 wrote: post #56

Earlier quoted context omitted.

Is this honestly a question? Murdoch disdain for Google is well known.

Rupert Murdoch can have well documented dislike for Google without his dislike intrinsically kneecapping the Wall Street Journal’s journalistic integrity. The comment I replied to criticizes the article we’re discussing categorically by origin, instead of specifically on merits. Murdoch’s agenda can be a thesis statement for why the WSJ has poor journalistic integrity with respect to Google, but it doesn't demonstrat…

Murdoch also has a well known taste for owning news sources that have no journalistic integrity.

Re: Google winning 98% ad spots it auctions off, after order to treat others equally

#67

Post by jasonmp85 » Wed, Jan 31, 2018, 1:48 AM UTC

sqdbps wrote: post #22

ucaetano wrote: post #19

> Kelkoo CEO Richard Stables says the firm’s revenue from general search traffic dropped by 62% last year, to €2.3 million. In 2018, he projects a two-thirds drop to €800,000. I decided to go to http://www.kelkoo.co.uk/ to check it out. This website is so clearly a scam created for this antitrust case. I went ahead to compare two cameras: the Canon EOS 1D X Mark II (a $4k camera) to a Canon Ixus 275 HS ($200 camera),…

>This is pure bullshit, and bullshit journalism. It's the "Wall Street Journal", a Murdoch business publication that approves of every business as long as it isn't Google.

I'm hearing they are a publication who is right for the wrong reasons.

Re: Google winning 98% ad spots it auctions off, after order to treat others equally

#68

Post by emilfihlman » Wed, Jan 31, 2018, 1:53 AM UTC

dsacco wrote: post #48

sqdbps wrote: post #22

Earlier quoted context omitted.

>This is pure bullshit, and bullshit journalism. It's the "Wall Street Journal", a Murdoch business publication that approves of every business as long as it isn't Google.

> It's the "Wall Street Journal", a Murdoch business publication that approves of every business as long as it isn't Google. Please don't bring politics into this. If you have a substantive criticism about the WSJ's article, make that criticism. The one you've made is ideological and unpersuasive.

No one brought politics into this.

Re: Google winning 98% ad spots it auctions off, after order to treat others equally

#69

Post by savanaly » Wed, Jan 31, 2018, 2:31 AM UTC

natch wrote: post #6

Tell me if I've got this right: Say you have some businesses in industry X that all rely on advertising. Say one of those businesses also happens to own the dominant advertising platform that businesses in industry X need to use, in order to effectively find customers. (Special note for those subset of HN readers who tend not to read: Yes there may be other platforms, but before you present that as an objection, note…

>In this setup, the business that owns the advertising platform has an advantage over all other businesses in industry X, because it pays itself advertising revenue, where the other companies have to pay their competitor. So money is always being siphoned off to pay the advertising platform, with a cost to most businesses but a (near) zero cost to the business owning the platform.

I don't think this is quite right. If I have a fixed quantity to sell (approximately true for advertising space on the web) then units I buy from myself cost me the same as they would cost other companies.

Suppose I have $100, and 5 advertising spots worth $20 each. I have two options here:

a) If I sell the spots to others then I have $100 + 5 * $20 = $200.

b) If I "sell" the spots to myself (the other wing of my company that needs to advertise) I have $100 and whatever 5 advertising spots are worth.

You are representing the situation of b as if it were "free advertising", thus giving my company an unfair advantage. But in fact, compared with situation a, it is clear I paid for the advertising, as I am up 5 spots and down $100 I could have obtained by selling the spots. So advertising's cost is not lower just because I also own the company that sells the advertising spots. If I'm better off than someone without advertising spots that's because advertising spots are worth something, not because of any purported shady synergy I get from owning both the advertising spots and the company that needs them.

Re: Google winning 98% ad spots it auctions off, after order to treat others equally

#70

Post by xstartup » Wed, Jan 31, 2018, 2:52 AM UTC

benchaney wrote: post #41

admax88q wrote: post #23

Earlier quoted context omitted.

It means that any expense you spend on Y isn't really an expense, since the money goes right back into your pocket. So not only do you get the extra income from other people buying Y, buy you can operate at higher margins than everyone else in X because Y is available to you at cost. EDIT: On further thought it seems no different than being vertically integrated.

> It means that any expense you spend on Y isn't really an expense, since the money goes right back into your pocket. If you do the accounting in this way, then you make that much less profit on your service, so it winds up being the same as if you are making a greater profit, but count the cost of Y at market value. > So not only do you get the extra income from other people buying Y, buy you can operate at higher m…

That's not how auctions work. Let's say A owns advertising business X and shopping business Y. Now, if B who only owns shopping business Z will be paying their competitors. If A bids higher, money still flows black to them regardless of the profit/loss. But Z is forced to bid much higher to get any traffic! This can be used to inflate the price to any level. Sure, others can also inflate the prices but if you try that then the money goes to A and you lose that money but it's not true for A. In this Google operates like A.

Edit: Google has lot more data about a visitor and which enables them to predict more. So, they can sell their competitors (in shopping business) the impressions which never convert while selling the impressions which are highly likely to convert to their own shopping business.