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Google's Eric Schmidt Says The Economy Is "Pretty Dire"
engine




msg:3862756
 6:25 pm on Mar 4, 2009 (gmt 0)

Google's Eric Schmidt Says The Economy Is "Pretty Dire" [news.cnet.com]
Google CEO Eric Schmidt expects 2009 to be a "tough, tough" year and he warned that the search giant is "not immune" from the worsening economy.

The search giant's chief touched on a wide variety of topics and, specifically, how they affect Google, during an on-stage chat with tech analyst Mary Meeker during the Morgan Stanley Technology Conference held Tuesday in San Francisco. But he focused mostly on the economy, calling the current climate "pretty dire" and adding that he doesn't expect it to improve until next year.

"It obviously will affect the online advertising market because our systems are so tightly tuned. If customers are buying less, it will eventually be reflected in CPCs and CPMs," he said, referring to cost per click and cost per 1,000 impressions, respectively. "We are not immune to this."

Schmidt also said that Google "was pretty inactive right now" on the mergers and acquisitions front, blaming unfavorable prices.


 

weeks




msg:3862865
 8:02 pm on Mar 4, 2009 (gmt 0)

pretty inactive right now" on the mergers and acquisitions front, blaming unfavorable prices.

I don't understand what he is saying here. It would seem that many firms, hurting for cash, might be more eager to be acquired now. Not that I know of anyone they might consider. Just an odd statement.

Interent Yogi




msg:3862873
 8:13 pm on Mar 4, 2009 (gmt 0)

Google might no be "not immune" But they will certainly be around in 2 years time . Maybe this is putting the breaks on the massive growth that they have had.

I think that it is a period of reconsolidation all around. Those good businesses that are strong will stick around & those that are not so, will find it tough. I think that as long as you are using the slower times to be more productive,Educate yourself, (maybe look over the expenses that you never had time to go over to see if you really need it ). things will turn around. Even in these times there will be business setting records in all sorts of different industries.

So less time surfing Google News and other time waster sites that we all have & more time on Split testing, Upping conversions, new product development, more education etc etc. As it is certainly not business as usual over the coming year.

[edited by: Interent_Yogi at 8:16 pm (utc) on Mar. 4, 2009]

wildbest




msg:3862875
 8:16 pm on Mar 4, 2009 (gmt 0)

Simple enough. He expects stock market to fall further and get more favorable prices.

LifeinAsia




msg:3862876
 8:17 pm on Mar 4, 2009 (gmt 0)

It would seem that many firms, hurting for cash, might be more eager to be acquired now.

My guess is that they are either not hurting enough (so not willing to lower the selling price), or are far overvaluing themselves (and thus not willing to lower the selling price). Or both.

As time goes on, it's more likely those prices will come down. With the capital markets what they are (or rather, what they are NOT) right now, Google probably doesn't need to worry too much about competitors swooping in ahead of them.

Just because you're sitting on a pile of money is no reason to spend lots of it if you don't need to.

pageoneresults




msg:3862910
 8:53 pm on Mar 4, 2009 (gmt 0)

Google probably doesn't need to worry too much about competitors swooping in ahead of them.

No, what they need to worry about is being labeled a monopoly in search which appears to be in the making right now according to the news. I'm guessing that the new administration may have some issues with Google's aggression in acquiring and dominating everything Internet.

I think there are multiple factors at play here. Google might be "forced" to put the brakes on because of continuing pressure from the Federal side. Last month's narrow margin in search share gain and/or loss may be a sign of some cutbacks and a slightly different approach to growing the Gorg.

You reminded me, I need to finish my visual on the Google Acquisitions Timeline. They've been up to something big and I think 3 to 4 years of acquisition data is enough to paint a picture. :)

koan




msg:3862919
 9:08 pm on Mar 4, 2009 (gmt 0)

Simple enough. He expects stock market to fall further and get more favorable prices.

Seconded. They're waiting for real bargains.

weeks




msg:3862939
 9:21 pm on Mar 4, 2009 (gmt 0)

Waiting for real bargains. Maybe so. There is likely not a lot of competition now. Waiting could be wise. But, my gut says the Yogi is closer to what is. "As it is certainly not business as usual over the coming year."

rominosj




msg:3862954
 9:41 pm on Mar 4, 2009 (gmt 0)

And, the stock market should fall further if bad news like AIG yesterday keep popping up, and they will pop up for at least six more months.

Problem is those who entered the market at 6000 ten years ago, were sitting zipping whiskey with no worries when markets were at 8,000 to 9,000 for a few months. Now, that it has approached the mark in which they bought, they are loading on whiskey because of worries, and they think they should sell, so they do sell, market drops, and then those who got at 5,000 11 years ago start to worry, they sell, drops to 4,000, and the chain goes on, and on, until bad news disappear or are minimized which I think will be in about six more months or third quarter.

honestman




msg:3862990
 10:27 pm on Mar 4, 2009 (gmt 0)

"It obviously will affect the online advertising market because our systems are so tightly tuned. If customers are buying less, it will eventually be reflected in CPCs and CPMs," he said, referring to cost per click and cost per 1,000 impressions, respectively. "We are not immune to this."

This does not bode well for Adsense publishers, obviously, as we have seen a movement downwards in CTR which has been quite significant for many year-over-year. Of course, we have to expect such events in this economy, and diversification has never been more important. Google is not immune and will, of course, do what is in its own interests and that of stockholders. At least they are not asking for government funding...

pageoneresults




msg:3863124
 1:39 am on Mar 5, 2009 (gmt 0)

Will Google Buy Twitter in 3 Weeks?
[fool.com...]

Speculation is in the air...

Google isn't really taunting Twitter -- it's negotiating. Taking Twitter down a few pegs helps drive a lower price and soothes antitrust regulator concerns. And if history is any kind of dependable professor, Google is now three weeks away from swallowing Twitter whole.

Miamacs




msg:3863152
 2:30 am on Mar 5, 2009 (gmt 0)

...

feels great.
- they finally admit lower cpc/cpm
- their communication on the issue isn't any more sophisticated than mine, yours or anyone elses' *heh*

...

"It's the economy"

loner




msg:3863285
 7:16 am on Mar 5, 2009 (gmt 0)

Poor Eric, it must be rough on him to tell us we shouldn't expect,... well,... anything.

texasville




msg:3864606
 9:13 pm on Mar 6, 2009 (gmt 0)

As far as acquisition costs..it's not always the selling price but also the delinquency of accounts receivable and liabilities. Most buyers are waiting to see if near bankruptcies are going to open up acquiring of plum assets instead of entire companies. Google is just biding it's time. Smart business.

JS_Harris




msg:3871124
 3:46 am on Mar 16, 2009 (gmt 0)

was pretty inactive right now" on the mergers and acquisitions front, blaming unfavorable prices.

Prices are great for the buyer, couldn't get better actually. Is he talking about the low trade value of Google's stock or something else completely ?

Will Google buy Twitter in 3 weeks?

I have no doubt Google is considering aquisition vs building their own version right now. This probably won't go over well with most but I think Twitter is just the fad of the moment. Advertisers value the "instant attention" Twitter can provide but it's still just one great big chatroom with a different skin.

[edited by: JS_Harris at 3:51 am (utc) on Mar. 16, 2009]

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