Google expected to generate $5B from tablet ads in 2013

Summary:The search giant could generate around 10 percent of its 2012 revenue in the coming financial year from tablet users alone, according to new research.

Google is expected to generate around $5 billion in advertising revenue from tablets alone, according to a report by one leading Web search advertisement buyer.

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Marin Software, whose clients spend around $4 billion per year on search ads, said in a report (via The Wall Street Journal) that tablet users will contribute a significant amount to Google's revenue stream as the company aims to refocus its efforts on an expansion of devices outside the PC realm. 

The move to push advertisers to tablets could generate double-figure percentages of the company's revenue by this time next year, when it reports 2013 fiscal year results. 

According to 2012 fiscal year figures, Google generated $50.17 billion in revenue, with around 95 percent of that on advertising alone. Slam the figures together and Google could generate more than 10 percent of its 2013 ad revenue just from tablet users, if revenue remains flat. 

It comes hot on the heels of changes to Google's ad network , which will see advertisers plug their products and services on smartphones and tablets—even if they want to reach a PC only audience—due to the consistently converging lines between PCs and tablets.

Google said in a blog post announcing the move that the consumer behavior on tablets and desktops are "becoming very similar." With this, the prices of ads placed on Google's search results on tablets will equal those of desktop search ads. For now, they're around 17 percent lower. 

According to the report, tablets will account for around one-fifth of all clicks and taps on Google's search ads in the U.S. as the trend continues to push in tablet makers' favor.

Tablets are expected to hit 165.9 million units in 2013,  according to IDC figures , compared to around 352 million PCs shipped by manufacturers as of the last quarter, again according to IDC . Tablets represent roughly 45 percent of the total PC market. It's worth noting that while tablet shipments are on the rise, PC shipments are down year over year, and continue to decline quarter on quarter.

Topics: Google

About

Zack Whittaker writes for ZDNet, CNET, and CBS News. He is based in New York City.

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