Google's sneak attack? Adsense for Facebook
Is Google-the-Goliath sneaking into the Facebook building — via the basement? — Google is actively recruiting third-party developers with applications on Facebook to run Adsense ads within applications pages, VentureBeat has learned.
Context & Ripple Effects
Two weeks after commentary argued Google could achieve social network domination without owning a social network, this report shows the mechanism: instead of building a Facebook rival, Google is going around Facebook's front door and recruiting the third-party developers already inside its platform to run AdSense on their application pages. Valleywag picked the story up the same day.
The timing sharpens the point. Days earlier Google's shares pierced $600 for the first time even as analysts flagged growing risks, while the same coverage noted that popular Web 2.0 companies including Facebook had yet to make substantial real money. Google owns the pay-per-click ad machine, Facebook owns the audience, and the app developers sitting between them currently have no monetization of their own.
First-order effects
- Facebook's third-party application developers gain an independent revenue stream through AdSense, monetizing traffic they currently run on Facebook's pages for free.
- Facebook sees ad inventory sold on its own application canvas by its largest advertising rival, without its consent or a revenue share.
Second-order effects
- Facebook must now choose whether to tolerate, tax, or block third-party ad networks on its platform — a governance decision that determines how much economic independence its developer ecosystem keeps.
- Advertisers gain a route to social-application audiences outside Facebook's control, pressuring Facebook to stand up its own ad sales operation rather than leave the inventory to Google.
Third-order effects
- If open platforms cannot control who monetizes inside their walls, openness becomes a double-edged sword: distribution scales quickly, but the ad economics leak to whichever network owns the advertiser relationship.
- The pattern points toward ad networks competing inside each other's properties, with platform owners ultimately pushed into building their own ad businesses to keep those economics at home.
The trend: Social platforms are becoming contested advertising territory, with established search-era ad networks reaching users through third-party developers before the platforms themselves can sell the inventory.