There are thousands and thousands of startup businesses in the Internet world that are planning to build gigantic user bases on the assumption that they can monetize their efforts with advertising.
This is nonsense and bad business.
In the United States the advertising world is roughly $170 billion. Of this, so far, Google has more than $50 billion. There is almost as much advertising in the world outside of the United States.
As a percentage of our GDP this is a little over 2%. For a business to aim its success at 2% of the gross revenues of the United States is mistaken. Especially when Google is getting the bulk of it for doing a real job.
Google is distinct from the others who plan to have little sentences or images inserted for the advertiser. Google connects an actual search by a real human being with a real working desire to a potential consumer for the seller. I called this ‘listing’ not ‘advertising’. Advertising is a scattershot effort to reach anybody who might be interested. Advertising is Mercedes and Kia reaching hundreds of millions of people, 99% of whom are not interested in an expensive or an inexpensive car.
Everyone else planning to build an Internet business on advertising is chasing a mirage. Advertising is a trivial amount of revenue.
I own stock in Google which gets its ad revenue by directly connecting businesses with consumers; I own stock in Amazon which is actually selling real products and services; I also own Netflix which gets its revenue from people who pay monthly to be entertained.
To me the rest of the Internet businesses are based on a bad business model. Especially in an age when businesses are able to connect directly to interested consumers via Google.