Google “Read Data” Offer Rare Look Inside World Of Android, Mobile Ad Revenues

Yesterday The Verge published internal Google data about Android and mobile ad revenues. They offer a fascinating window into Google’s projections and expectations for the platform and mobile in general. These data are the first “real numbers” that have been exposed about Android and mobile ad performance at Google — beyond the $2.5 billion “run rate” figure exposed last year on a Google earnings call.

Data Dump Involuntary

The data were produced during testimony at the Google-Oracle trial over Google’s unlicensed use of Java and potential patent violations. The data were compiled in Q1 2010, but reflect Google’s mobile revenue expectations through 2013.

As Google pointed out in a statement to The Verge, these data are from a point in time and in several respects are no longer accurate. In some ways Android has dramatically exceeded Google’s expectations (overall unit sales) and in other areas (e.g., tablets) Android has underperformed.

Android Smartphone Sales Beat, While Tablets Disappoint

As the chart below reveals, Google expected Android to have 30 percent of the smartphone market by 2013. It also expected to have 33 percent of the tablet market last year. As it turns out the smartphone projections were low and the tablet share estimates were obviously high.

Here are some additional data reflected in the slides:

1. Android users were conducting 2.65 searches per day per device

2. Google expected $9.83 in annual Android advertising revenue per Android device in the market

3. Total mobile revenue in 2009 was $16.8 million

4. Google set a goal of $626 million in overall mobile revenue for 2010 but expected to fall short by $348 million (based on revenue momentum in Q1 2010)

5. In 2012 Google projected $840 overall mobile revenue (which has already been exceeded)

6. App sale revenues were not expected to be meaningful for Google

7. Apple (iOS) was/is Google’s number one revenue source in mobile

Reflected in the pie chart above (created by me based on Google estimates), Google anticipated that the majority of mobile ad revenue would be from paid search, followed by in-app advertising and finally AdSense for mobile in 2010.

In fact, mobile paid search is the majority ad revenue category for Google. And I would imagine on a “directional” basis the distribution between in-app and mobile web display ad revenue reflected above is correct and Google is getting more from in-app display ads than from the mobile web.

Mobile Query Volume: 30 or 60 per Month?

Google estimated its paid search revenue based on an expected 1.1 queries per day per mobile device. That would obviously translate into 33 mobile search queries per month. However above Google seems to be saying that its smartphone users were generating  2.65 actual queries per day per device in 2010. That would translate into more than 60 mobile search queries per month.

According to survey data from several sources that 60-query per month figure seems high. While there’s a minority of users (say 10 to 15 percent) who search more than 30 times per month, most users conduct fewer than 30 mobile search queries per month.

Regardless, these data give journalists and analysts valuable information against which to assess the accuracy of their forecasts and mobile ad models. And it gives us a rare, unauthorized glimpse into Google’s internal thinking and expectations around mobile.