I said very few things have higher margins than software. Google's search engine and ad platforms are software systems, and Google is a software company first and foremost; they always have been, and always will be.
The extrapolated principle is obvious here. Google writes it once, and scales it toward infinity. The same principle worked for Microsoft with Windows; the same principle is at work for Salesforce.com or Facebook or Oracle, regardless of what we call it ("cloud"). This principle is what makes most software so profitable, per user there's usually nothing to uniquely manufacture or create. With scale margins properly skyrocket.
So whether we're talking about software search, or software retail, or an ad business built on software (eg Google's hyper automated ad system) or software services, the difference doesn't matter much.
I said very few things have higher margins than software. Google's search engine and ad platforms are software systems, and Google is a software company first and foremost; they always have been, and always will be.
The extrapolated principle is obvious here. Google writes it once, and scales it toward infinity. The same principle worked for Microsoft with Windows; the same principle is at work for Salesforce.com or Facebook or Oracle, regardless of what we call it ("cloud"). This principle is what makes most software so profitable, per user there's usually nothing to uniquely manufacture or create. With scale margins properly skyrocket.
So whether we're talking about software search, or software retail, or an ad business built on software (eg Google's hyper automated ad system) or software services, the difference doesn't matter much.