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If You Have To Find One Reason To Worry About Google's Long Term Health, This Is It

If You Have To Find One Reason To Worry About Google's Long Term Health, This Is It
Tech2 min read

Google stock is up 139% over the past five years and 6% this year.

That's because the company basically owns a monopoly in the internet's best business: search advertising.

There's very little reason to worry about that revenue stream going away or even slowing down. Every day more people are living their lives fully connected to the Web, and Google remains the best way to navigate the web.

Whenever anyone (outside of China) wants to find something to buy on the Web, they are likely to search for that product via Google. When they do, they will see a Google ad, and click on it.

That's how Google developed revenues like these:

Google revenue

If you wanted to worry about Google, here are two charts to help you out. We talked about them in a lengthier post yesterday. We first saw them in a post by Andreessen Horowitz partner Chris Dixon.

The first chart shows what you already know, that mobile users surpassed desktop users this year:

desktop versus mobile users in 2014

Comscore

The second chart shows that, increasingly, mobile users prefer to connect to the Internet via apps rather than the mobile Web.

apps versus mobile web

Flurry

Looking at those two charts, we can perhaps infer the following: The world is moving away from desktop computers. As the world does this, it is using the Web less. That's bad for Google, which depends on consumers using the Web (rather than apps) to buy things through the Internet.

Google's ownership of Android doesn't help it, because Google doesn't charge anyone anything for the use of Android. (The point of Android is to put a Google web search bar in front of more people.)

The counter-argument: Yes, time spent on the mobile Web continues to dwindle relative to the overall time spent on mobile devices - but the overall time spent on mobile devices is skyrocketing, both because connected individuals are spending more time with devices, and because more individuals are getting connected. Google has a smaller fraction of the pie, but the pie is growing really fast.

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