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0 pointsChuckMcM11y ago0 comments

This is entirely possible. I will see if I can come up with ways to test that hypothesis. One puzzling bit of not well known information is that Google recently yanked their mobile ad feed from many (if not all) of their partners. One way to interpret that would be that they were trying to shore up their mobile CPC values. Really too bad they don't break out mobile and non-mobile.

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wutbrodo11y ago· 3 in thread

If I'm not mistaken, the CFO mentioned that Simpson's Paradox was at work (by name) during the actual earnings call.

ChuckMcMOP11y ago

I didn't listen to the call, just read the statements and collected what information I could from them.

But I did download the slide deck, look at Slide #5 of 15. See how all the CPC numbers for all the properties are down.

Now look at how Paid Clicks (page 4) are up for the same periods. More clicks, less money per click. It includes their AdMob business (aka Mobile) but blends a bit because is a search ad on Android a O&O (Google Sites) click or a mobile click?

But there is a more interesting point here. If we stipulate that Simpson's paradox is at work here, and we stipulate that Pichette is interested in communicating clearly to the shareholders, would he not have the fiduciary duty to disclose the confounding variable?

After all if the appearance that the value of Google's search advertising business is eroding away, and that is, rounded to the nearest billion dollars the only business that makes Google any money[1], as an officer of the company you would want to say "Sure it looks that way but when we break it out you can see that really we're doing fine." otherwise you would leave people with the wrong impression, and they might sell or buy your stock acting on that misimpression which might form the basis for future litigation against the company. (This happened a lot in the 90's btw).

For me, I tend to be skeptical (its my nature), so if Pichette wanted to convince me that the ship is doing fine, he needs to let me know why there is water in my stateroom. :-)

[1] Youtube is catching up to be sure. But pretty much not a whole lot more is.

wutbrodo11y ago

> See how all the CPC numbers for all the properties are down.

> But there is a more interesting point here. If we stipulate that Simpson's paradox is at work here, and we stipulate that Pichette is interested in communicating clearly to the shareholders, would he not have the fiduciary duty to disclose the confounding variable?

I checked out the transcript, and it turns out I was mis-remembering the context of the mention of Simpson's paradox: it was with respect to a question along the lines of "Why is the aggregate CPC growth higher than both the network and the Google Sites"? It would of course be comically absurd for a CFO to mention Simpson's Paradox and not say what the confounding variable is, and even more ridiculous for nobody else on the call to ask him to clarify. In context, the variable was the network/Google sites split.

diminish11y ago

Recently on Adwords, it's more difficult UX-wise to stop mobile targeting or bid less for tablets (or mobiles). I guess G is intentionally pushing people to bid as high for mobile & tablets as they did for desktops. As a careful observer (not as good as ChuckMcM), I see them popping up new and new tricks to give a better quarterly report.

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