Google Defies Economics with Unlimited Ad Space

graph of the law of supply and demand

Google makes money – a lot of money. The question is, how long can this continue? How many more ads can they make that generate $2 or more each time someone clicks on them?

The answer is, probably more than you can imagine. Read Write Web wrote a post about the economics of google and their phenomenal growth.

Read more about how google is defying the law of supply and demand.


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5 Responses

  1. Great issues with the google monopoly, What might you suggest in regards to alternative advertising locations?

  2. The bidding prices will have a cap, beyond which they can’t go.

    Most avg users of Google Adwords are very limited in spending beyond a point, since it can’t be both logical and feasible beyond that point.

    This pressure will certainly show on Googles earning growth.

  3. Sergio, yes the internet bubble was irrational in 2000 and the reason it crashed is because businesses were either WAY over valued, had no business model or both.

    Google has a fantastic business model, a growing user base, and is fantastically profitable.

    Nothing is unlimited, but Google is the Microsoft of the 1980’s and will dominate for the foreseeable future.

  4. Google does not defy the law of supply and demand. The last time we hear talk like that was in 2000. We all saw how well that stipulation panned out. The article on Read Write Web makes an incorrect claim that the demand for Google’s goods and services is unlimited. It is not.

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