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Comment by oblio | Hacker News Reader

I like to ask people what's the biggest advertising company in the world.

You'd be surprised how many people don't know :)

You know who else would be surprised, is 1998 Larry Page & 1998 Sergey Brin. Especially the part about hearing their company called an "advertising company," much less the largest one.

Which then makes any ad-paid company an advertising company. Which is a completely useless definition.

Don't mix source of revenue with core business, especially in multi-sided markets.

Don't complain to me, I didn't say it.

But their core business is selling advertising.

I say the same about largest media company in the world.

It's shocking that people don't know it's Facebook.

And in their case not just in the world, but the largest media company in history by a very wide margin. People don't see any connection between William Randolph Hearst and Mark Zuckerberg; Facebook really has the best PR team.

Well the difference is that Facebook is an aggregator and doesn't actually publish or write any of their own content. They're a media company, sure, but they're not directly comparable to newspapers or cable news outlets.

Google doesn't make the ads either, they just publish them on their platform

From a consumer point of view, Facebook is pretty much a news source. For some even the only news source.

Exactly what do newspapers and cable news have in common with each other that Facebook doesn't?

They pay reporters.

Facebook employs moderators.

In other words: Facebook doesn't employ journalists, certainly not to do journalism.

You don't see a difference between a moderator and a reporter in terms of content creation?

Quite many of them don't, many (most?) not-top newspapers re-publish news gathered by others; many (most?) cable companies don't produce any news content themselves but just provide access to a bunch of news channels. Those still are media companies.

> many (most?) not-top newspapers re-publish news gathered by others

If you're referring to AP and other news services, they pay quite a lot for that, so the reporters are paid. Also, they contribute their own stories from their paid reporters to the service for other members to share.

Facebook is an editor(like at a newspaper), except in this case editorial control is determine by billions of users and a completely opaque "News Feed" algorithm.

Remember, people don't just share articles, they share articles with their commentary.

Channel matters FAR more than content.

("Content is king" was always a distraction. And that came from Sumner Redstone (Viacom), not Bill Gates, who only quoted it.)

In a world in which any piece of content you want to exist does exist because someone is written it (and we're a lot closer to that world now than in Hearst's day), power lies not in production of content but in control over which content actually gets seen.

They do though, Facebook Watch is them funding original content.

Might it not be Google?

> I say the same about largest media company in the world.

Indeed. I was just reading about the local broadcast rules (specifically: Sinclair broadcasting wants to buy Tribune media, and the FCC appears to be saying 'go ahead".) . Some people are concerned that this violates rules against concentration of ownership in broadcast stations.

But doesn't Facebook operate in essentially 100% of US markets? Should we even care who owns the TV broadcasts?

The rule was made because radio waves (broadcast) is a finite resource, and so there are a limited number of players who can compete.

The internet can, theoretically, have an unlimited number of competitors, so it's not regulated the same way.

Sure, that mattered in the 1930s but does it really matter any more?

Are there suddenly unlimited over-the-air frequencies available to broadcasters?

No, but there are so many channels of info these days OTA broadcast is a minor part of it. In addition the economics of the business lead to increasing amounds of network content rather than expensive locally generated content on the airwaves. And in fact OTA is much less common than watching local channels mixed in with otehr channels on cable, so again the local channels aer drowned out.

Looking up the stats a couple of weeks ago during a different HN discussion I was shocked how popular TV still is across all demographics, but local content was a plummeting percentage of the total.

Who is the biggest advertising company? Google?

Unless something changed recently, I believe that $95bn of advertising revenue makes them the biggest advertising company in the world :)

They are the medium, not the advertising company, the same way a tv channel is the medium, not the advertising company. WPP, Omnicom, Dentsu, those are advertising companies. You are conflating here two different things.

they are distribution, just like the agencies. Only Google drives distribution costs down

Probably WPP or Omnicom.

Google.

By a factor of 30

30? More like 5. Still a good point.

Revenue vs market cap

Omnicom: $15B revenue annually, $17B market cap WPP: $18B revenue, $23B market cap Google: $110B revenue, $750B market cap

Seems like a good argument that being tech-forward provides a multiplier on value versus doing the same old thing, if you believe that these are all just advertising companies.

> Google: $110B revenue

Where did you get 110 from? I'm seeing 90 for last year.

https://finance.yahoo.com/quote/GOOGL/financials?p=GOOGL

$110B total revenue for 2017

That's all revenue, including non-advertising revenue.

True, the ad revenue was $95B.

Yeah, I screwed up and was looking at the wrong number.

Hardly a fair comparison, considering Google's extensive non-advertising product offerings

Extensive non-advertising product offerings that somehow don't translate into extensive non-advertising revenue...

Those "other revenues" only account for about 13% of Google's revenue. So its a fair comparison. Google is almost 90% an advertising company.

https://abc.xyz/investor/pdf/2017Q4_alphabet_earnings_releas...

Yes because all those apps exist... to funnel people towards Google's extensive advertising network, so the money shows up as adbiz revenue instead of with products.

So, by pursuing other technological innovations, they are able to expand their advertising business?

"if you believe that these are all just advertising companies."

I'm not the one calling Google an all-advertising company, I'm just saying that if it is, it's by far the biggest.

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