They serve their customers very well, by targeting the advertising to what the people they are serving want.
The ecosystem in which they function is critically important. There are conditions they need to be successful, and new technology can open entirely new markets to them.
They need:
Willing advertisers
Receptive viewers (Finding these people is the key to their success)
Content to draw viewers
Bandwidth to deliver content and advertising
A medium to show the content (a "screen")
Without any of these things, their business doesn't function. The bandwidth and the medium depend on advances in technology
They know your behavior
Facebook knows what you're doing on your computer. If you'd like to figure this out, go and shop online for something that you are normally not concerned with. For example, look for an unusual hardware item. Just pretend you really need to find an unusual part for something around the house. Spend 20 minutes looking for it online, then sign back on to Facebook. You will find advertisements you see on Facebook now feature these items.
Google and Facebook KNOW what you're doing with your device. That will serve MicroVision very well in the not too distant future.
Mobile was a new market
The smartphone was a new medium. Before the first iPhone, the mobile phone didn't deliver advertising very well. When the smartphone came into being Facebook and Google got new markets. Their businesses grew.
Weird Economics
There are some weird economics that occur with mobile devices too, weird may be the wrong term -- but counter-intuitive, and indirect. Many devices are sold at a severe discount, because money can be made from the content, the subscriptions and other add-ons that go with the device. We've all seen a $650 cell phone sell at best buy for $20 or $50 with a contract.
In 2013, the cost to make a PS4 was $381. It was sold for $399. So, after packaging & shipping, and allowing retailers to make money, Sony made zero selling the PS4. Yet gaming is one of their most profitable endeavors.
The profit for the company (SONY does make a lot of money on gaming) comes from the secondary market, selling the games, the subscriptions and content through the device.
If we put this together, how can this dynamic benefit MicroVision?
AdWords and Search Advertising (GOOGLE)
The bulk of Google’s $66 billion revenue in 2014 came from its proprietary advertising service, Google AdWords. Of that revenue, 68 percent – or just over $45 billion – came from Google’s own websites.
How does Facebook Make its money? (Nice presentation, a little dated.)
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