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Comment by astrange | Hacker News Reader

“Surveillance” isn’t very profitable; Google ad targeting isn’t even good and when it is good it doesn’t need your data. (For instance, if you search for “buy ps5” they don’t need a secret profile to show you ads for a PS5.)

The reason their ads make infinite money is they’re the best at serving them, they’re vertically integrated, and their ad auction systems are set up to cheat in their favor.

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> For instance, if you search for “buy ps5” they don’t need a secret profile to show you ads for a PS5.

Sorta. The real money is from competitors. How much would Microsoft spend to convince someone interested in a ps5 to to spend $500 on an xbox instead? Sony wouldn’t spend as much as Microsoft here except to outbid them out of that ad.

And you’ve just shown your hand at having $500 to dispose, maybe a local casino ad would fit well here?

While the geographies of gaming consoles overlaps well, it doesn’t for automobiles, restaurants, service providers (mechanics or dentists or whatever).

>> The real money is from competitors.

Yep:

https://www.google.com/search?q=free+cad+software https://www.google.com/search?q=free+office+suite

Asking for open source or GPL will usually get rid of the ads at the top. Companies can clearly pay to get results at the top that don't even fit your search terms.

Ads must be relevant to be shown. The casino ad would probably not be shown at all, but even if it were they would have to pay more than Sony.

>> For instance, if you search for “buy ps5” they don’t need a secret profile to show you ads for a PS5.

>Sorta. The real money is from competitors. How much would Microsoft spend to convince someone interested in a ps5 to to spend $500 on an xbox instead? Sony wouldn’t spend as much as Microsoft here except to outbid them out of that ad.

But they still don't need a secret profile to show you ads for an Xbox when you search for PS5...

That’s why it’s not a great example. But if I’m searching for a fiat, it wouldn’t make sense to target a Renault ad against me because they don’t sell those here.

Targeting is only one of the reasons for the large amount of tracking that Google does. The second reason is conversion tracking, and that one's way more important to Google's customers. They do want to know that if you see a specific ad for a specific thing, whether you now buy it or not.

An attempt to answer the statement "I waste half my money advertising, problem is I don't know which half"

Then why do I have to sign off on 65 pages of “we collect every scrap of info about you short of sequencing your genome, and we would do that too if it weren’t a logistical nightmare” every time I install a piece of software or buy a device with wifi capability? Someone ought to relay this insight to tech companies - it would save them a fortune.

Because their having your data is a liability for them, not an asset, which is why they want to offload some liability on you.

If it's a liability, where are the company ending fines and lawsuits?

There aren’t any because you signed the TOS. Many people have tried class actions about these things, but they never get anywhere meaningful. Europe is trying with GDPR to tip the balance back to the users, but the countries are stuck with massive backlogs that prevent progress.

I just cashed a $400 check from Facebook for illegally using my data. I imagine they'll be more careful next time.

Is that still the case? Do we know how much of Google's ad revenue is directly from their own search product? Obviously the genius of putting ads on a search engine is that it's a perfect fit: the users are literally typing in what they're interested in. But surely Google is also making big bucks now from ad products where this isn't the case (or is less so the case), like third-party web ads (AdSense) and mobile app ads (AdMob), as well as embedded ads in other Google products (like Gmail), and presumably those do rely heavily on tracking user behavior.

If that were true then they wouldn't collect it.

It doesn't mean it's effective, but it's still clearly profitable.

I said “very profitable”.

“Surveillance capitalism” earns nothing compared to how much cash Apple makes, but there isn’t a field of studying “cell phone capitalism”.

There’s plenty of study of the practice of one entity selling a good or service to another entity. You might call it “economics” or “business.”

“Surveillance capitalism” is interesting/unique because not all of the relevant parties in the exchange (users, platforms, advertisers) actually understand their role in the exchange.

Google started out collecting it with no idea what to do with it. User data was a waste product like gasoline was before someone invented a mass market car. Google figured out they could buy the then-leader in targeted advertising and apply their data to it when the tech market turned and investors suddenly started asking about business models.

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