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Google CEO: Mobile Advertising Will Surpass Online

google_schmidt.gifGoogle CEO Eric Schmidt was interviewed on CNBC’s Mad Money with Jim Cramer, and he stated that eventually Google can make more money from mobile than it does on the desktop.

He was very optimistic about Google’s prospects for growth overall, and for their ability to capture a significant share of the worldwide advertising spend.

Among the areas he singled out was mobile advertising. In fact, he feels that eventually Google could possible make more money from mobile then from the desktop business. And the reason – personalization and targeting.

“We can make more money in mobile than we do in the desktop eventually… and the reason is the mobile computer is more targeted. Think about it: you carry your phone, and your phone knows all about you… we can do a very, very targeted ad. Over time we will make more money from mobile advertising… not now, but over time.”

If Google believes that mobile advertising may become the majority of their business, you have to think that the Android mobile operating system will have been developed with that in mind. Although Schmidt refused to give an exact date for the first shipment of an Android phone, he confirmed that it should be during 2008. It will interesting to see just what features Google has included in Android that enable more targeted, personalized mobile advertising.

Here are some more key points from the interview (source: CNBC’s “Mad Money w/Jim Cramer.”)

(Responding to a statement that the advertising industry is $600 billion dollars now, and a question asking if it’s reasonalbe to think that Google might capture 10% of that).

SCHMIDT: Well we could. By the way, the number is larger than $600 billion, it’s about $1 trillion globally. It’s perfectly possible in the online world it would be half – we won’t get 100%.

We don’t know how long it will take, but we know everybody’s moving from traditional (advertising) mechanisms to targeted and measurable ones, and online is where the measurable ones are.

(Responding to a question about Google’s growth prospects internationally)

SCHMIDT: First, we don’t know what’s going on with the global economy. Google will do better in any kind of slowdown than non-targeted advertising, but we might be affected by it, you never know.

The important point is that our model continues to work as people are shifting from offline to online and that shift is going to happen no matter what.

(Responding to a question about whether Google can continue to grow, or if they will eventually slow down as Intel and Microsoft did).

SCHMIDT: All these tech companies hit the S-curve. They go through a rapid growth period, then slow because the law of large numbers. You’re growing but just can’t put enough numbers on the board. You solve that by having new businesses, and we’re working on that.

The display business, which is a huge opportunity, we should become a huge player but we are not. Mobile should be a large one. The way you address the slow down in any technology business is that you keep adding other businesses that are growing.

(Responding to the point that Steve Balmer and Bill Gates of Microsoft thought of that, but it didn’t work)

schmidt_quote.gifSCHMIDT: That was a different generation. This is an advertising generation, and advertising is a multi-sector thing. We can do this advertising really well, but there are a lot of opportunities for us. They’ll organize themselves as the technology allows, and some of them will grow faster than others. That’s how we’ll address this question.

The source for this post is CNBC’s “Mad Money w/Jim Cramer.”

Read the full “unofficial transcript” of the interview.

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