Online dating is big business. According to comScore Media Matrix, Yahoo! Personals and Match.com are the most active sites, drawing 5.3 million and 3.9 million unique monthly visitors, respectively. Because relationship-seekers are also willing to pay for online introductions, the services help diversify the revenue mix. With 99% of its revenues still coming from advertising, Google would be more stupid than Cupid to forgo a shot at a high-margin niche that would help grow its ever-expanding reach.
I beg to differ. Having worked with a company involved in the online dating industry, I can tell you how difficult that space is right now. Just this weekend, the WSJ highlighted the slowdown of online dating with growth for this year dropping from double digits to just 7%.
Unless Google can find a way to utilize AdWords so that they can offer a free service, it makes no sense to spend the time and money entering a market where the existing revenue model (paid subscriptions) is seeing a slowdown.