Sharp45

Why Buffett Would Not Buy Google

Interesting piece, but this is incorrect:

"the way the company makes 99% of its money is by putting publishers and advertisers together"

Google makes the vast majority of its profits from Adwords (ads that are on search results). There are no publishers involved in this aspect of their business, at any point. If you search for "car insurance" and click on a Geico ad, $5 (estimate) goes directly to Google.

The smaller part of their business is Adsense, which are text-ads on publisher sites. Lots of revenue here, but not nearly as much profit as Adwords. With Adsense, they pay publishers about 60-90% of the revenue generated per-click from advertisers. They keep 100% with Adwords.

So as long as Google dominates search (which should be a very long time, I think) their main source of profits will be intact and growing healthily.