Google Report Claims Wide Economic Benefits
Hoping to stress its importance as federal regulators continue to scrutinize its business practices, Google released a study Tuesday that estimated that the firm helped generate $54 billion in economic activities for U.S. businesses in 2009.
The firm released the report at a Capitol Hill news conference during National Small Business Week in an effort to show how Google services such as AdWords, text ads that appear along side or at the top of Google search results, and AdSense, which shares profits from ads that appear on content creators' Web sites, benefit small businesses.
The $54 billion total was derived by adding the profits companies get from Google services such as AdWords, the revenues Google paid out to Web sites that use its AdSense program and the in-kind grants Google provides to nonprofits in each state, according to Google Vice President of Global Online Sales Claire Hughes Johnson.
The report provides a state-by-state breakdown of the economic value Google estimated its services have in each state. California, where Google is headquartered, had the biggest total of $14.1 billion, while Alaska had the smallest at $15.9 million. Three entrepreneurs were at the news conference to discuss how their business have grown with the help of Google services such as AdWords and AdSense. Ross Twiddy, director of marketing for vacation home provider Twiddy & Company Realtors of Duck, N.C., said AdWords helped take the company from the "dark ages" into the "Renaissance."
"These Businesses are growing and Google is thrilled to play a role," Hughes Johnson said.
Senate Small Business Chairmwoman Mary Landrieu, D-La., said one way the federal government is helping small businesses is by promoting broadband deployment and adoption and touted the Obama administration's push to include $7 billion in last year's economic stimulus for these efforts.
Google critics such as NetCompetition.org Chairman Scott Cleland, whose group is made up of major telecom and broadband providers such as AT&T and Comcast, said the report discounts what some see as Google's negative impact on businesses such as newspapers through its Google News service and through its market domination in the online advertising market.
"Google employs selective and misleading accounting in calculating its 'total' economic impact, including all the benefits, but not all the costs of its economic impact," Cleland said. He added that the report is a "gimmick" aimed at burnishing Google's image with policymakers.
John Simpson of Consumer Watchdog, which has criticized Google's digital books project and its privacy practices, added that "This is what every big corporation does when they are under fire. They divert attention from their wrongdoing and spin a story about their contributions."
Facebook also was quick to get in on the action, claiming the social networking site also provides a valuable way for small businesses to reach new customers. More than 250,000 Web sites have integrated with the Facebook Platform, while more than 100 million Facebook users engage with Facebook on external Web sites every month, according to Facebook spokesman Andrew Noyes. (Noyes is the former editor of Tech Daily Dose)
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