A billion in Google ads here a billion in Android ads there and pretty soon it doesn't add up

Still another well-paid analyst who makes big money working closely with the firms he covers, remarks on the amazing advertising revenues -- and potential -- of Android:

Research firm Piper Jaffray predicts that Android could generate more than $1 billion in mobile advertising revenue for Google in 2012. Android generated $5.90 per user in mobile advertising in 2010 and the research firm predicts that number will increase to $9.85 by 2012. Comparatively speaking, Google search generated $18.85 per user and Google advertising in total generated $25.77.

Google's former CEO Eric Schmidt once said that Android could potentially be a $10 billion business if it had 1 billion users paying $10 per year. One reason we are confident in Google's ability to increase ARPU on Android from $5.90 last year to $9.85 in 2012 is that the company has refocused on the Android Market,” Mr. Munster said in his research note.

I'll ask again: are these incremental revenues? Will they *always* be incremental revenues? For example, let's assume the analysis is correct. By 2012, Google will generate $1 billion in Android ad revenue. Google ads can appear on other platforms, so let's double this to $2 billion.

$2 billion is a very nice addition to the company's bottom line, to be sure. But we have to at least question if this is all the revenues that Google's Android can generate. I believe more and more search and related activities will take place on the smartphone. A large percentage of these will not *supplement* our PC activities, but *replace* them. How soon, then, before we reach a point where the additional Android revenues become the primary source of Google revenues? And can this ever equal the monies they generated on the PC platform?

Maybe the well paid analyst should consider that before publishing his notes.