Google bought YouTube, but is struggling with ironing out ad revenue shares and advertising. What is the easiest way for Google to fix these issues? Integrate YouTube and Google Video directly into Google's search results.

Using what legal loopholes they may and something they call universal search, you can now listen to music videos directly from Google.com search results. This creates a marketplace that many businesses will need to be in to stay relevant, destroys a whole vertical of web spam, AND allows Google to monetize the organic search results (via YouTube). If you think video is a passing fad you bet wrong, but if you are doing it you are best off branding your videos to be associated with your domain name and uploading them to YouTube. Eli offered tips on how to make $1,000 a month re-purposing video, but now the number is more like $20,000.

Sure Google has done many YouTube users wrong, but if you need exposure, Google turned back the clock on SEO. Top ranking have never been easier. All you need to succeed is to format your content in video and upload it to YouTube.

Tim O'Reilly compares Google and Amazon to offline companies:

If Google or Amazon were your bank or credit card, they'd let you know which merchants had the best prices for the same products, so you'd be a smarter shopper next time. They'd let merchants know what products were popular with people who also bought related products. They'd help merchants stock the right products by zip code. They'd let you know when you were spending more on dining out than you have set in your family budget. They'd let you know when you were approaching your credit limit, with a real-time fuel gauge, not just a "Sorry, your card has been declined."

Universal search mixes videos and news in the organic search results and recommends other verticals at the top of the search results. And Google is testing a broader array of layouts.

By making search richer you have less reason to leave Google. Google started with targeted text ads, but it is even better if they can combine their targeting with trusted brands and offers while making their ads look like a useful piece of content in any format.

Google is further commoditizing the role of the ad agency. They are signing up advertisers interested in trying their new Ad Creation Marketplace:

In the Ad Creation Marketplace, you'll find industry professionals who can provide script writing, editing, production, and voice-over talent at an affordable package cost. It's free to search for and send project bids to specialists, and you aren't under any obligation to work with them until you accept a bid.

Google's great value has been in targeting and tracking, but text and image ads are not as emotionally appealing as video ads. As they try to move up the value chain to caputre branding ad dollars they are trying to create a support ecosystem that helps the market grow quickly and keeps the market as efficient as possible.

How much does Google expect ad production to cost? Crumbs:

Once you accept a specialist's bid, you might expect to spend anywhere between $100 and $1000 for your ad.

YouTube is taking over the organic search results, and they are buying a ton of AdWords ads. Google doesn't even take the time to write relevant ads when promoting YouTube. Their second ranked ad for the word music doesn't even contain the word music.

Clearly with an ad so irrelevant they are not factoring in quality score into YouTube's ad position, or if they are they are paying themselves over $5 a click for the word music. How is a competing service to compete when they are forced to write relevant ads to be able to afford the click, and Google serves itself sloppy targeted broad reaching branded ads?

As Google arbitrages itself one vertical at a time the only businesses that are safe are:

• those that get traffic AROUND Google

• those that provide Google with the high quality content that Google is forced to rely on to keep spam out of their SERPs
• those that Google does not have enough data or brand strength to compete with, or have some important offline component
• those that are so small that Google doesn't want to compete

Google has been progressively eating their own search results with...Google.

I hate to use Avril Lavigne as an example, but I am about to go to a sweet concert, so maybe this is ok. Looking at the following searches, notice how Google is promoting Google or sites that are editorially selected and trusted by Google.

Their music service promotes trusted resellers, their news service promotes trusted news sources, and their top ranking YouTube pages (promoted externally and internally and algorithmically favored) will eventually consist largely of trusted content providers.

This self arbitrage and backdoor partnerships as organic relevancy work on core popular search phrases:

and it scales on through to less popular phrases that are hot right now:

If you didn't understand what I was talking about in Google Closing the Window of Opportunity, the above images should do a good job of showing how search is moving away from purely algorithmic to an editorial blend approach, and how Google is making itself a leading vertical search engine in many verticals.

The easiest way for Google to be perceived as relevant is to make it easy for other authorities to want to talk about Google as being innovative and relevant. If Google is willing to send significant traffic to trusted sources how could those sources do anything but trust Google?

Rumor has it that eBay just bought the web 2.0 toolbar company StumbleUpon, which helps users stumble into new and interesting pages based on the votes of friends and others with similar interests. THE SAME DAY that rumor came out Google added a toolbar feature which recommends websites you might be interested in based on your recent search queries.

Competitive Intelligence & AdSense Funded Startups

Google's biggest advantage over their competitors may not even be the cheap computer cycles. It is probably consumer trust. StumbleUpon only had to raise $1.5 million in funding before being bought out, largely due to low cost structure, but also because they turned stumbles into unmarked ads, offered a sponsorship based model, and published AdSense ads on their site.

Google can buy out or clone any service that threatens their ad market and media dominance.

Asset Pricing & Public Relations

Since StumbleUpon was an AdSense publisher, Google saw their growth rate, and had better market data as to their value than eBay possibly could have. As soon as they started talking about sales, Google could make the best offer, or decide if it was just cheaper to clone something in-house, then overshadow competing news by adding the feature to the Google suite ahead of the buyout news.

Advertising leads to exposure, which leads to more exposure, which leads to market dominance. Now Google is recommending content. Maybe those same content sites chose to advertise with Google from time to time, or maybe they syndicate Google's ads and convert well. If you were Google, and you were recommending ads and content based on earnings wouldn't that lead to recommending biased content that converts?

Trademarks & the Sketchiness of Relevant Recommendations

Google maintains that they are legal with their keyword based ad targeting. Judges struggle with the cases:

"The large number of businesses and users affected by Google's AdWords program indicates that a significant public interest exists in determining whether the AdWords program violates trademark law," Fogel wrote in his decision.

Maybe they are legal, but when you get to content websites or contextually targeted ads you can't be certain why Google is displaying an ad. Is it site targeted? Page targeted? Geographically targeted? Automated based on a keyword and trademark in the page title, or personal character flaws, or conversion data?

Arbitraging Your Brand One Click at a Time

With pay per action ads Google turned the link into a virtually unmarked ad unit. They will likely control distribution based on how much revenue an ad makes Google. If you buy distribution from lead aggregators, and they buy Google CPA ads, their ads may be automatically targeted by Google against any media mentioning your company, at first you will think these aggregators are doing a great job, and you might even pay them a higher commission. But then you may start to notice fewer direct inquiries.

Upon further inspection some of these lead aggregators use domain names similar to your brand, like VillanovaU.com, and their ads appear on just about any content related to Villanova. Eventually you realize that you are best off brokering a deal directly with Google, so you do.

Introducing Google Tax

This is how Google will kill many mid market players and get a piece of the action for most large businesses. They will keep automating recommendations and arbitraging against your brands and trademarks until you decide to broker an ad deal directly with Google, and if you don't give Google a big enough cut they will just recommend an arbitrager, some high converting currently hot scam, or a competitor of some sort.

Affiliate marketers funded search and showed business the value of search before getting pushed around by ad quality scores. The lead aggregators will show businesses that they can just work directly with Google. Off the start the numbers will look great, and they will keep doing well until direct inquiries gradually decline as the Google Tax is applied.

I think Werty was the person who coined Google Tax, while he was between paintings, working on his garden.