SCHMIDT: WE HAVE A BIG DEAL WITH "THE NEW YORK TIMES" AND WITH A BUNCH OF OTHER NEWSPAPERS. WHEN PEOPLE COME TO GOOGLE, LOOKING FOR NEWS, WE SEND IT TO THE TIMES AND WE ALSO SHOW SOME OF OUR ADS ON THEIR SITES AND THEY GET THE MAJORITY OF THE REVENUE. SO THEY MAKE MONEY BOTH ON THE TRAFFIC COMING TO THEM AND OUR AD SYSTEM.

CRAMER: LET'S SPEAK ABOUT A QUESTION THAT AGAIN, I'M TRYING ADDRESS THE QUESTIONS HOLDING THE STOCK DOWN. YOU HAVE TREMENDOUS DOWNLOADS IN YOUTUBE ARE EXTRAORDINARY.

SCHMIDT: IT'S UP TO 1.3 -- MILLION MINUTES EVERY TEN MINUTES OF UPLOAD? IN OTHER WORDS EVERY MINUTE WE ARE PUTTING THAT MANY VIDEOS IN. IT'S UNBELIEVABLE.

CRAMER: BUT AT THE SAME TIME, WHAT ADVERTISER WANTS TO PUT A 30 SECOND ADVERTISEMENT IN YOUTUBE, WHO WANTS TO LOOK AT THAT VERSUS THE ADVERTISEMENTS WE ARE DOING FOR THE OLYMPICS WHICH ARE JUST GIGANTIC 1.7 BILLION IN REVENUE. ISN'T IT TRUE THAT PEOPLE DON'T LIKE ADS ON YOUTUBE?

SCHMIDT: WE HAVE NOT FIGURED THAT MODEL OUT YET.YOU'RE COMPARING A 50-YEAR-OLD MATURE MODEL THAT WORKS REALLY WELL ONCE EVERY FOUR YEARS IN THE OLYMPICS, VERSUS SOMETHING THAT'S JUST STARTING. WE HAVE LOTS OF TRAFFIC.

CRAMER: SO YOU ARE JUST SAYING SOMEONE WILL JUST FIGURE IT OUT.

SCHMIDT: HOPING IT'S GOING TO BE US THAT FIGURES IT OUT. WE'RE TRYING DIFFERENT THINGS WE TRIED PRE-ROLL AND POST-ROLL NOT ANYONE ONE IS REALLY, WE HAVE A COUPLE NEW ONES COMING OUT.

CRAMER: YOU'RE MAKING SO MUCH MONEY YOU DON'T HAVE TO WORRY ABOUT IT. IT ISN'T LIKE IT IS GOING TO HIT YOUR BOTTOM LINE.

SCHMIDT: IT DOESN'T HIT OUR BOTTOM LINE.

CRAMER: SOME ARE SAYING IT WILL.

SCHMIDT: BUT EVENTUALLY WE'D LIKE TO MAKE MONEY OUT OF IT, BUT IF WE DON'T, THE FACT THAT SO MANY PEOPLE COME TOYOUTUBE, MEANS THEY ULTIMATELY GOOGLE AND DO GOOGLE SEARCHES AND CLICK ON ADS. SO DON'T BE TOO WORRIED ABOUT ALL THAT TRAFFIC GOING TO YOUTUBE. I'D BE WORRIED IF PEOPLE WEREN'T USING YOUTUBE. SINCE IT IS AN ENORMOUS SUCCESS GLOBALLY WE KNOW WE WILL BENEFIT.

CRAMER: LAST QUESTION. I WANT TO KNOW, THE PRESS,IKE THE I PHONE. EVERYONE SAYS YOU'LL NEVER SEE ANYTHING LIKE THE ANDROID.WHEN IT COMES TO DESKTOP, OWNING MOBILE MAY BE UP TO YOU GUYS DEVELOPING ANDROID AND BEING SUCCESSFUL. WHERE IS IT? HOW BIG CAN IT BE? CAN YOU GIVE ME A STEVE JOBS 10 MILLION THIS YEAR KIND OF THING?

SCHMIDT: NO I CAN'T.

CRAMER: WHY?

SCHMIDT: IT HASN'T SHIPPED YET. IT WILL SHIP BETWEEN NOW AND THE END OF THE YEAR. IT'S SOFTWARE.

CRAMER: NO I NEED SEPTEMBER, OCTOBER.

SCHMIDT: NO BETWEEN NOW AND THE END OF THE YEAR.

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