September 30, 2005

Google ads, the alternative to superannuation saving

For a while now I have had minimal advertising on this blog by Google ads, and they kindly keep me up to date as to progress of impressions and profit sharing. In August I earned $0.02 and in September $0.01. Since Google pays out as soon as a total reaches $100, at the current pace I'll get my first cheque in the mail in about 5,000 to 10,000 months, which is between the years 2071 and 2138.
This seems to be a good wicket Google is on. Let's suppose there are about 15 million blogs with Google ads on them. The vast majority will have click through rates like mine (I have yet to meet the first blogger who lives off his advertising), so Google will collect advert fees from advertisers but doesn't need to pay out to blog owners. Basically, it gets to keep the $0.01 a month from 15 million blogs, that is $150,000 per month or $1.8 million a year. On which it earns interest before having to pay it out in 70 to 100 years' time. The wonders of compound interest being what they are, this will yield many hundreds of millions of dollars for Google. No wonder its shareprice is 2.5 times last year's issue price.
So, bloggers, shall we all delete the Google ads? Will capitalism as we know it then collapse?

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