) policy appears clear: if you can't buy them or extinguish them,
you better partner them. This is exactly what it did with
) in October last year when everyone was moaning about the
growing competition from the social networking company. And it's
doing it again now, with
) and its real-time-bidding platform.
Real-time bidding is another name for programmatic buying
where advertisers get the chance to bid in real time for a
particular impression. Obviously this means the utilization of a
technology platform that automates the bidding process. This is
what an ad exchange or demand-side platform is all about.
An exchange typically brings on a large number of bidders for
each impression, thereby driving up prices. Conversely, it also
increases the amount of inventory, which has to be managed
effectively to ensure that prices don't come under pressure.
What Google's doing with Yandex is simple: its combining the
DoubleClix Ad Exchange with Yandex's system called AWAPS. This
essentially makes for a bigger marketplace and allows Google to
access a market that is 60% owned by Yandex.
As a result, advertisers on Google's platform get to target
the largest chunk of the Russian market, while those on the
Yandex platform gain access to Google's global presence.
It certainly looks like a win-win situation and we will be
keeping an eye on Google's results to see if there's a notable
Speaking of which, Google has been growing quarterly revenues
by strong double-digits for quite some time now, no mean feat
considering the growing competition, its leadership position and
the constant talk about privacy concerns. But that is the name of
the game that Google plays better than everyone else.
It's not been as lucky on the bottom line however due to
pricing concerns, increased investments and the shift to Enhanced
Google carries a Zacks Rank #3 (Hold), which lags
) Zacks Rank #2 (Buy) only because of the latter's position in
China. Facebook with its Zacks Rank #2 (Buy) is also worth
BAIDU INC (BIDU): Free Stock Analysis Report
FACEBOOK INC-A (FB): Free Stock Analysis
GOOGLE INC-CL A (GOOG): Free Stock Analysis
YANDEX NV-A (YNDX): Free Stock Analysis
To read this article on Zacks.com click here.