> There are a lot of markets where this is completely played out. That is, Google get a cut (anywhere from 10% to 50%) equivalent to the average margin that advertisers earn on whatever they're selling. The advertiser is whoever has the highest margin. Insurance, for example.
Sounds like actual insurance has been commoditised, whereas Google is still making monopoly rents on advertising. There's some kind of analogue of Amdahl's law: the cost reduction from commoditising part of the work of producing a product is smaller than you would think, because the cost will increasingly come to be dominated by the parts that can't be commoditised.
Sounds like actual insurance has been commoditised, whereas Google is still making monopoly rents on advertising. There's some kind of analogue of Amdahl's law: the cost reduction from commoditising part of the work of producing a product is smaller than you would think, because the cost will increasingly come to be dominated by the parts that can't be commoditised.