Untangling Advertising: An Analysis of the Basics

A critical component of today’s technology economics is advertising. Like it or not, we as a society put a lot of effort and intelligence into getting internet users see ads, click on them, and potentially buy the advertised products. It’s important to have an understanding of the industry and see where it’s going.

Most of the major tech companies derive some revenues from advertising, ranging of little in the case of Apple and a lot in the case of Google. In fact, a major part of Google’s revenues come from its ad products, Adwords and Adsense.

Let’s look at some basics of online advertising. The economics of advertising are the same online or offline. There are generally 3 primary parties, the advertisers, or the companies who want to increase their products


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