{"id":90076,"date":"2017-11-13T10:15:13","date_gmt":"2017-11-13T15:15:13","guid":{"rendered":"https:\/\/ipwatchdog.com\/?p=90076"},"modified":"2019-02-06T09:58:36","modified_gmt":"2019-02-06T14:58:36","slug":"ptab-targeted-advertising-patents-google-ad-revenue","status":"publish","type":"post","link":"https:\/\/ipwatchdog.com\/2017\/11\/13\/ptab-targeted-advertising-patents-google-ad-revenue\/id=90076\/","title":{"rendered":"PTAB invalidates targeted advertising patents, preserving billions in Google ad revenue"},"content":{"rendered":"
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“Google Stand” by Sam Greenhalgh. Licensed under CC BY 2.0<\/a>.<\/p><\/div>\n

It is no secret that the fortunes of Mountain View, CA-based tech conglomerate <\/span>Alphabet Inc.<\/span><\/a> (<\/span>NASDAQ:GOOGL<\/span><\/a>) are largely based upon the advertising revenues accrued through its subsidiary <\/span>Google<\/span><\/a> and its incredibly popular search engine. <\/span>The company\u2019s most recent earnings report for the third quarter of 2017<\/span><\/a> shows that, of the company\u2019s $22.5 billion in revenues for the quarter, $19.8 billion came from Google advertising revenues. That\u2019s nearly 90 percent of Google\u2019s entire revenues for the third quarter; the rest comes from Google\u2019s other revenues ($2.4 billion) and Alphabet\u2019s Other Bets ($197 million). The name of the corporation may be Alphabet but that entity is nothing without Google and its advertising revenues.<\/span><\/p>\n

This third quarter revenue trend for Google is no anomaly. The first nine months of 2017 saw the tech giant take in $64.2 billion in revenues. $57 billion worth of those revenues were generated from Google\u2019s advertising operations. If advertising is incredibly valuable to Google, it appears that Google is also very valuable to the world of advertising according to analysis of <\/span>a 2016 Internet advertising report<\/span><\/a> published this April by the <\/span>Internet Advertising Bureau<\/span><\/a> (IAB). The IAB concluded that Internet advertising revenues in the United States through 2016 reached $75.2 billion for the year, an increase of 21.8 percent over 2015\u2019s totals. Using IAB\u2019s advertising revenue totals released in a quarterly update in June 2016, Jason Kint, CEO of <\/span>Digital Content Next<\/span><\/a>, provided analysis of IAB revenue numbers and corporate earnings reports in a blog post which showed that <\/span>90 percent of Internet advertising revenue growth went to Google<\/span><\/a> and fellow American tech giant <\/span>Facebook Inc.<\/span><\/a> (<\/span>NASDAQ:FB<\/span><\/a>) Google itself took 52 percent of digital ad growth based on those numbers. These were similar to <\/span>numbers released by Kint in response to the IAB\u2019s 2016 full year report<\/span><\/a>.<\/span><\/p>\n

Google\u2019s advertising revenues are generated through properties like AdSense and DoubleClick Ad Exchange through which advertisers purchase ad inventory and most customers pay Google on a cost-per-click basis; others pay on a cost-per-impression basis. Part of what makes these services so valuable is that they have mechanisms for targeting audiences based on the massive compendium of data which Google has on all Internet users through its search engine. Google openly admits that <\/span>AdSense targets audiences in multiple ways<\/span><\/a> including contextual targeting based on keyword analysis, placement targeting for specific location placement on publisher web pages, personalized advertising meant to engage viewers based on demographic and interest data, as well as language targeting based on appropriate language on publisher web pages. <\/span>AdSense also offers device targeting<\/span><\/a> so that advertisers can \u201cshow your ads to the right people across all devices, based on their specific location, time of day, and device type.\u201d Similarly, buyers on the DoubleClick Ad Exchange can benefit from demand-side platforms buying over multiple exchanges \u201c<\/span>using sophisticated targeting capabilities and optimization algorithms.<\/span><\/a>\u201d<\/span><\/p>\n

Google\u2019s ability to target audiences with its advertising tools, then, is of crucial importance to the entire company. It\u2019s just too bad that Google and Alphabet do not own the patent covering the technology which is earning them about $20 billion each quarter. Some wonder whether this could explain why Google has been so actively engaged in very public efforts on Capitol Hill and in the Courts to weaken the U.S. patent system. <\/span><\/p>\n

In September 2012, Memphis, TN-based B.E. Technology, L.L.C., filed a suit alleging claims of patent infringement<\/a> against Google in the <\/span>Western District of Tennessee<\/span><\/a>, asserting claims from two patents owned by the company. Those patents are:<\/span><\/p>\n