Google declines to reveal mobile ad revenue due to changing ‘mobile’ definition

22 May 2014

Google has communicated to the Securities and Exchange Commission that it could be placing ads on ''car dashboards, thermostats, glasses, and watches'' within the next few years, in a  newly revealed letter.

The letter written in December sought to contest the SEC's request for a breakdown of mobile revenue.

According to Google, it should not be required to disclose the revenue breakdown as mobile was evolving to include a variety of different technologies. ''It is increasingly challenging to define what exactly a 'mobile' platform is from period to period -- and what it will be going forward,'' the letter said.

The tech giant had been working on technology  called the ''Internet of Things.'' The internet giant announced that it was purchasing smoke detector and thermostat maker Nest for $3.2 billion earlier this year (See: Google to acquire Nest Labs, maker of smart devices).

Fox Business quoted a Google spokesperson as saying, the company was in contact with the SEC to clarify the language in this 2013 filing, which did not reflect Google's product roadmap. He added, Nest, which the company acquired after the filing was made, did not have an ads-based model and had never had any such plans.

Google Glass, which also opened sale to the public, could also generate a new kind of mobile revenue by showing advertisements on smart glasses. Android announced earlier this year that it was building an operating system for smartwatches, which could be another venue for ads.

Google, Facebook, Twitter and others had been asked by the Securities and Exchange Commission to reveal ad revenue from mobile sources.

''Our expectation is that users will be using our services and viewing our ads on an increasingly wide diversity of devices in the future,'' the company said in the filing.

Google added it could be serving ads and other content on ''refrigerators, car dashboards, thermostats, glasses, and watches, to name just a few possibilities.''

Meanwhile, technology columnist Guy Wright said in tthe online technology website Tech Guru Daily that while he agreed with Google's contention that the definition of mobile was evolving, on the other had he thought it was perfectly reasonable for the SEC to ask Google and others to at least try and break out their various revenue streams in reports to their investors.

He further said that the scary bit was a vision of the future where people were inundated with ads popping up on all their connected devices, with for instance thermostats trying to sell insulation, coffee makers trying to sell people filters, refrigerators trying to sell groceries, and smoke detectors trying to sell home owner's insurance. ''Isn't there a limit to how many ads we can consume?'' he questions.