Why Google Needs A Chief Economist

June 1st, 2009 by Ilya Marritz

Wired explores Google’s web ad revolution: it’s not just the breadth and depth of the user data that make this a $21 billion a year business, it’s also a sophisticated system of auctions that instantaneously determines winning bids in the millisecond it takes to return your results. No small undertaking:

Varian [Google’s Chief Economist, Hal Varian] believes that a new era is dawning for what you might call the datarati—and it’s all about harnessing supply and demand. “What’s ubiquitous and cheap?” Varian asks. “Data.” And what is scarce? The analytic ability to utilize that data. As a result, he believes that the kind of technical person who once would have wound up working for a hedge fund on Wall Street will now work at a firm whose business hinges on making smart, daring choices—decisions based on surprising results gleaned from algorithmic spelunking and executed with the confidence that comes from really doing the math.

Since financial institutions relied on complex risk models designed by geniuses to create, sell, and purchase mortgage-backed securities, let’s just hope this particular band of geniuses stays out of trouble.

PS: It’s been so long since I personally have really looked – you know, looked – at a sponsored ad link on Google, I decided to search “coffee” and just see what showed up. The very top sponsored link? Bing! Microsoft’s new competitor search engine…Where else are you gonna go to steal search traffic, right?

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