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Afterall they have not created the next big idea and are still selling advertising for a living.
Will they bounce back or will investors now take a more realistic look at their business model?
Who knows perhaps Yahoo may even buy them :)
UBS cut its price target on Google Inc after U.S. paid-search data for January showed Google's sponsored clicks, the basis for its advertising revenue, fell 7 percent sequentially, and shares of the Web search giant tumbled more than 8 percent.
"While Google's search volumes were decent (up 39 percent year-on-year), actual paid clicks were flat...continuing a decidedly negative trend," analyst Benjamin Schachter said in a note.
[edited by: Brett_Tabke at 7:22 pm (utc) on Feb. 26, 2008]
[edit reason] added links to story [/edit]
In a few years time we will say that 2008 was the turn of the tide for Google.
By then, a view back in history may probably read like this: "In Spring 2008, the first signs of Google being vulnerable were visible. It began with a weak quarterly report in January, followed by reports of slowing click activity of Adwords, Google's only profitable product. More and more analysts began to downgrade the stock, which lead to the inevitable avalanche of sales orders. Their stock dropped like a rock within few weeks. Today, the stock is trading around $8.50, a mere 10% of its IPO price, and lightyears away from its $750 all time high in 2007."
> Anyone think it's going to tank even further?
A bit more. Aside from the ComScore report - Sergey "unnerved" stockholders with his recent comments. If Google really did pee their pants over the Yahoo take over attempt, then that is cause for core leadership concern.
I'm going to make sure I whiten my teeth tonight, because I'll be smiling for days and days.
Google has nothing special other than they are a current FAD. The tide will turn, just like it did for Netscape, Yahoo, AOL....Rome?
Anything tech is toooooo easy to replicate. Google is not engaged in rocket science, far from it. Many of Google's moves at the management level, portray their policies as if they are running in a 100 yard dash. Looking for quick hits of cash any way they can get it. When in reality they are in a marathon, and the people that run companies don't and won't forget how they have suffered at the hand of google. 1 small move after the next, they continue to create anti sentiment towards their company. More and more google is going after the bottom line and loosing site of what made them great.
Maybe soon they'll be a good candidate to be on American Greed.
Microsoft, Yahoo, IBM, Apple and even Earthlink - all UP today. This aint the economy at work.
Most of those companies don't derive the bulk of their revenue from consumer advertising.
ADDENDUM: The next post in this thread includes a link to a FINANCIAL TIMES article that states: "Fears that Google could become a victim of a US economy flirting with recession appeared to be the main factor in the share sell-off."
Many of Google's moves at the management level, portray their policies as if they are running in a 100 yard dash. Looking for quick hits of cash any way they can get it. When in reality they are in a marathon
Really? I'd say the opposite is true. They willingly gave up short-term ad revenue when they introduced AdWords quality scores, for example, and again when they reduced the AdSense click area to discourage accidental clicks. Everything I've seen suggests that they're more into long-term strategy than short-term tactics. (This thread [webmasterworld.com] is a good case in point.)
Of course, people who think like day traders may have trouble seeing the bigger picture.
Mark Mahaney, Citigroup analyst, said the decline could be caused by Google’s ongoing efforts to improve the lead quality for advertisers and the user experience for searches.
Well that could be the case, but going for quality traffic rather than just quantity, is part of what will make Google strong over the longer term. If Yahoo did this years ago, then they may not be in the position they are in today...
[edited by: Brett_Tabke at 9:03 pm (utc) on Feb. 26, 2008]
[edit reason] fixed long link [/edit]
Google has nothing special other than they are a current FAD.
How do you explain then that no one has been able to catch them in the search market and no one is close in online advertising? Google is most certainly the technological leader on the internet, it's not like someone can whip up a search engine in a weekend and compete with these guys.
Google is down because of the economy...and they missed in their last quarter so now analysts are unsure how they will perform in the next report...the comScore report on ad clicks going down are only hastening the analysts fears among other things I'm sure. Google should have just shut up about the Yahoo-Microsoft deal because they win no matter what. That deal is doomed from the word go and if they screw it up, Google wins. If it doesn't go through, Google wins. It's only in the most unlikely scenario where the merger goes through and actually works does Google have a bit of uncertainty.
What they need to do is to have a strong first quarter which would reverse the trend. Have the Doubleclick deal go through as fast as possible, work on their other advertising deals (weren't they working in tv, radio and newspaper? yeah, work on that Google). Not to mention that they need to finish their Apps and Docs. Put all the necessary features into that, give people an actual Office suite online and they will make a lot of money off those wanting to leave MS. Not enough as they make on advertising mind you, but still a good amount.
Sadly, Google is the king of search, advertising and not finishing what they start. Their ship isn't turning around, just slowing.
That would an interesting statistic...How many day traders actually frequent this forum? I personally am way too busy to be a day trader.
The following thread is from this week and in my opinion another dramatic display into how Google's management has shifted since they became public. This thread represents their focus, which is to ensure good stockholder returns at the expense of advertisers.
Is this whats happened then - they are reducing their click fraud aka accidental clicks and that has hurt their monthly click targets or have I got it wrong?
In the simplist terms, this and the prior two major drops in Jan and the beginning of Feb were all on much higher than average volume, while none of the intervening gains were seen on high volume, so I'd say these are a sign of a continuing downward technical trend for the forseeable future.