Google’s Q4 earnings call offers hints of company’s future
By Caitlin Dewey,
Google needn’t search far for reasons to celebrate this quarter. In an earnings call Tuesday night, the Internet giant reported gross consolidated revenue of $14.4 billion in 2012, a 36 percent jump year-over-year and a surprise to analysts who had predicted less growth.
But perhaps the most interesting part of the call were the hints about Google’s future, vague and fleeting though they were. Driverless cars , computer-planned vacations, phones that don’t break when you drop them — nothing seems off-limits to CEO Larry Page.
“We have talked a lot about excellence and velocity over the last year,” Page said on the call. “While many claim it’s my nature never to be satisfied, we’ve actually made real progress creating more beautiful and more intuitive products.”
Following are some other topics touched on in the call with reporters.
A Google phone, finally?
After a line of phones with Nexus, Google may finally launch its own — the rumored “X Phone” that tech sites have drooled over since before the company acquired Motorola in May. Page didn’t confirm the phone, but he did dedicate a lot of call time to discussing the “opportunities” Google sees in the phone space.
Among those opportunities: Developing a longer-lasting battery, better ways to charge up, and more durable phones that don’t “go splat” when you drop them.
“There’s a real potential to invent new and better experiences,” he said.
According to popular rumor, the X Phone could hit store shelves by May. That seems to coincide with the Motorola timeline Page referenced in the call —the company had a 12-to-18 month “product pipeline” at the time of acquisition, he said, and Google is working on it now.
Youtube has become one of the biggest forces behind Google’s growth, said Nikesh Arora, Google’s chief business officer.
Viewers watched an average of 4 billion hours of video a month in 2012. Gangnam Style, the most-watched video of all time, earned $8 million in advertising revenue — or roughly 65 cents a play, Quartz calculates.
But it’s the growth in mobile, tablet and smart TV views that Arora really seemed to hone in on. Youtube’s new iOS app has done well, he pointed out, and the company pushed its skippable TrueView ad format to Xbox, iPad and Wii this quarter.
“Videos are baked into the core of all of our products whether it’s search, display, mobile, and of course YouTube itself,” Arora said. “YouTube is well positioned for the changing viewing habits of today’s multi-screen world.”
Human assistants post-Siri
Page has previously alluded to a tool that could plan vacations for its users, grappling with all the inconveniences — weather, airline costs, personal preferences — that a travel agent would typically handle.
That was “more of an example,” he clarified in the call, but it does symbolize the type of work Google wants to do in the “human assistant” space.
“The main thing is to understand a complex problem. . . kind of solving that all at once in the way a human assistant might be able to do,” Page said. “Google’s aspiration is to be able to do that for any area.”
Page touted Knowledge Graph as an example of this complex problem-solving. Whether more “human assistants” are coming, only time will tell.
Currently, 44 percent of Google’s business comes from countries outside the United States and United Kingdom— up 23 percent year-over-year. That figure makes it clear that emerging markets will be key to Google’s future. But asked about the possibility of entering closed markets like China, Arora was a bit vague.
“We have an ad sales business. We have a display business in the market. We know there are many users who use Android devices in the market,” he said. “So we think we operate in China, not in the way you might perceive it, but users have access to our services and there is even a small revenue business that we have in China.”
Page fielded several questions about the monetization of several popular products, like Google Maps and Knowledge Graph. The bottom line: These things eventually will be monetized, but Google doesn’t yet know how.
“Generally we monetize those things. I don’t comment on the specifics of that,” Page said of Knowledge Graph.
Maps already generates revenue through search, he said, but “it’s likely to be a great source of revenue” when they develop the model further.
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