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Revenue Worries Knock Google

Written by Khalid Al-Khames on February 29, 2008 – 12:01 am

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A recent post by myself, Micro-Market Shakeup, suggested that Microsoft’s bid for Yahoo was opportunistic and if the internet was controlled by two major players - Microsoft and Google - the future for publishers earning an income online may become more difficult, less financially stable and less profitable.

google

With the sluggish US Economy impacting business on a World Wide scale, it was only a matter of time before Google was affected too. This occured on Tuesday, with Google’s share price being slashed 4.57% to $464. The move came after research firm Comscore reported a sluggish January in the viewing of paid-for-advertisements on the Google site.

The total clicking on to Google’s paid adverts was 532 million, down from 533 million a year before, Comscore said.

Despite the strong growth in searches in January, there was a decline in the click through rate of paid-for advertisements which create the bulk of both Google’s and publisher’s revenue.

So, what is the future?

I don’t have a crystal ball but I am certainly keeping my eye out for offline investments too. I’m not exiting the internet, in business you have to ride out the waves, but I am spreading my risks. Realistically, revenue can only lower to a certain level before an uproar or boycott occurs by publishers, with bigger sites probably conducting private ad deals.

I doubt we’ll ever have another dot com bubble, the internet is now a necessity rather than a luxury. However, in my own personal experiences where I see my PPC going to $0.03, it is apparent, and has been for a while, that publishers are not in control.

Good luck with your persuits,

Khalid.

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