Photo: Jemal Countess/Getty Images
Back in 2004, Google’s Marissa Mayer almost blocked the idea that became AdSense, Google’s second largest business, which now accounts for about $5 to $7 billion in annual revenue.In this video interview with Bloomberg BusinessWeek, Mayer explains how she was against the idea of putting ads in Gmail.
But as she tells it, an engineer named Paul (presumably Gmail creator Paul Buchheit) stayed up all night finishing the product, and when Mayer came in the next morning, she saw ads all over the place.
As she looked, she noticed the ads were actually pretty good — she had emailed a friend saying she was going hiking, and there was an ad for hiking boots. Buccheit had basically figured out how to scan text and match up ads that customers had already bought for search queries.
Soon, Google cofounders Larry Page and Sergey Brin saw the ads and were impressed with their relevance. So Google decided instead of just putting them in Gmail, they should take the technology and let third party sites use it to place relevant Google ads on their sites.
That became AdSense, which is now Google’s second biggest source of revenue after search ads. Mayer said that it accounted for $5 to $7 billion in revenue last year. Overall, ads on third-party sites (including display ads and other forms) contributed $10.4 billion to Google’s coffers in 2011.
Separately (not on the video) Mayer also told Bloomberg BusinessWeek that an ad on Google’s home page would probably cost $10 million, and that she was once obsessed with the Motorola StarTAC phone and collected a bunch of them.
Here’s the full 3-minute interview: