On Tuesday, September 25th, California Governor Jerry Brown signed a bill into law permitting automated vehicles to be tested on the roadways of California. California is actually the third state to sign this type of legislature, with Nevada and Florida already having created similar laws. However, having the most populous state, and home of Google’s headquarters, on-board makes the seemingly ridiculous prospect of driverless cars hitting the streets in droves a reality. Google has been testing this technology for the past ten years, and the law requires someone to be in the driver seat, so the technology isn’t especially new or even that dangerous. In fact, proponents suggest that driverless cars could reduce traffic fatalities by a factor of 2 to 3, effectively saving millions of lives. There is no human error involved in accidents if there is no human driving!
Now, being the conspiracy theorist that I am (Aliens have bases in the Ocean’s and Moon, Ron Paul had the most votes in the Republican Primary, and the Government is keeping the existence of Bigfoot from us all!), I couldn’t help but wonder if Google has an ulterior motive behind all this. Sure, saving lives is great. But is making the world a better place what this is really all about?
According to a poll done by Gallop, the average American worker spends 46 minutes a day driving to and from work. That adds up to 3.8 hours a week, and 182 hours a year (deducting 4 weeks for vacation and holidays). You don’t even want to know how many days that is. Ok you do. It’s 7.58. That’s over a week of your life spend sitting in your driver seat, yelling at the person in front of you while listening to sports talk radio to and from work. Maybe that analogy just applies to me, but you get the idea.
Where am I going with this? I try to play with my phone and drive at the same time just as much as the next guy, but it’s just too difficult to really get into it. Maybe I can squeeze out a text or two and perform a quick search on something, but fact of the matter is that I need to pay a decent amount of attention to ensure I don’t run into a fire hydrant or the guy in front of my playing with his phone. What would you do if you didn’t have to have 13% of your focus on the road at all times? You’d probably be playing with that fancy computer in your pocket that is a smart phone, or even bring your laptop to keep you company while your car is effortlessly conveying you to and from work. And if you’re anything like me, a lot of that time is going to be spent surfing the web, and performing multiple searches on most everyone’s favorite search engine Google. And just every once in a while, you’re going to click on a Google sponsored listing, putting a little more money in the wallet of the search engine giant.
Using some super rough and conservative numbers, lets assume that a commuter clicks on a Google PPC ad once every two hours while being driven to and from work. To make things easy, let’s also assume the CPC of that ad on average is $1. According to a U.S. commuting study done by Marcus Bowman of IAC transportation, 97,102,000 commuters drive alone. Based on all of this totally non-fuzzy math, we can project some intriguing numbers:
- 182 hours a year commuting * 97,102,000 solo drivers= 17,672,564,000 total commuting hours from solo drivers
- 0.5 PPC clicks every hour per solo driver * 17,672,564,000 total commuting hours=8,836,282,000 PPC clicks per year
- $1 average CPC * 883,628,200 PPC clicks a year= $8,836,282,000 additional pay per click revenue from commuting hours
Now, of course not everyone uses Google, so all of this added PPC revenue won’t be going straight to them. But even if that number is conservatively cut in half based on future search engine market share of 50% for Google, that is still over $4 billion a year in paid search revenue that didn’t exist before. And that is over 10% of $37.9 billion in revenue AdWords generated in 2011.
There are even more factors to consider before determining how much more money Google will make from paid search because of their future cars! How about all hours spent by drivers? The certain integration of Google search into any computing systems that come with the car? International data? The amount of additional hours created by the saving of millions of lives?
So is Google out to save lives? Perhaps. But they also probably like the prospect of making billions more a year from paid search.