Google Incorporating Video, Local Click-to-Call Ads In Search Results (GOOG)

| About: Alphabet Inc. (GOOG)

Mark Mahaney Smith Barney CitigroupCitigroup analyst Mark Mahaney sent a note to clients today on new features at Google (GOOG) that could impact revenue going forward -- key excerpts:

* We have detected on Google two new features which we believe have the potential to generate incremental revenue for the company over time.

* First, we discovered a video display link among Google's search results. Our belief is that this is the first instance of Google presenting a result that is not simply text-based. We interpret this as one of the first concrete indications of Google's intention/willingness to tap into relevant display advertising revenue.

* Second, we uncovered the first example of Google incorporating click-to-call functionality into its search results. And we view this as one of Google's first concrete steps at tapping into local search advertising markets.

* We think it is way too early to quantify the impact of these new features. And the click-to-call feature seemed very buggy to us. But we view the continuous product innovation as a positive.