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Demand Media Inc said Google Inc's new search algorithm hurt page views on some of its websites moderately, sending its shares down as much as 13 percent on Monday.
However, the company said some third-party estimates on the impact have "significantly overstated" the negative impact of those changes on traffic to eHow.com.
The reason they are making press statements is that their stock prices are influenced. But according to the article, only 28% of revenue was coming from Google traffic. That sounds healthy to me.
There is a lot of business and content savvy at Demand Media, and it's not a good idea to just slam them because of the worst pages on eHow.
I seemingly doubt those investors went into the situation blind or without hearing some guarantees.
...thereís a reason Demand Mediaís stock has fallen more than 40 percent this month. Today it hit its lowest level yet, $14.05 a share.
Some individual Demand sites are doing even worse than that, with Answerbag, a questions-and-answers site, being the hardest hit. Its Google referrals are down 80 percent. Meanwhile, eHow, Demandís largest and most important site by far, is down 29 percent;
The dangerous thing that can arise from this is people will likely associate that Google can obliterate any online businesses overnight and that can send jitters through the stock market. In other words itís being done to thousands of small businesses already without much fanfare so who will be next. Plus its gets even trickier when you claim no bias and youíre seeding your own index with sites that directly enhance your own earnings. It becomes more and more difficult to proclaim your innocence when youíre standing directly over a dead body with a smoking pistol in your hand.