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Article

Title: Has Economy Hurt Google Search Ads?

Author: Delaney, Kevin J Article Type: Company
Source: Wall Street Journal, v251 n90 pB1(2) Publication Date: Apr 17, 2008
  ISSN: 0193-2241
URL of Publication: http://www.wsj.com

Ahead of Google Inc.'s announcement of its first-quarter earnings, it is unclear whether the downturn in the economy has affected the company's search ad business. Research firm comScore reported that the number of times people have clicked on Google ads is down, worrying Wall Street. The company found that clicks were down 9.3 percent from the previous quarter, though up 1.8 percent from the first quarter of the previous year. Analysts worry that the firm has grown to such a size that its core business will be vulnerable to economic downturns. If this proves to be true, it may affect opinions on the Microsoft Corp. bid for Yahoo! Inc., as well as impacting online advertising in general. Some analysts interpret the numbers as a sign that U.S. consumers, hit by economic troubles, are clicking less because they are buying less. ComScore disputes this interpretation, and instead says that changes made by Google may be responsible, such as making its ads harder to click on by accident. When Google reported fourth-quarter earnings, the company said economic troubles had not impacted its bottom line. Google does not give detailed public earnings information, and numbers from comScore have been off in the past. Other analysts say that small and medium sized advertisers will be pulling back, while large buyers are holding steady or increasing the amount of money they are spending on search ads.

Companies:
comScore Networks Inc Google Inc
Microsoft Corp TecTerms
Yahoo! Inc

Products:
Search Engine Marketing

TecTerms:


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