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After years of reliably spectacular performance, Google Inc. is showing a sign that its business is slowing down.
A report released late Monday by comScore Inc. said that the number of clicks by U.S. users on Google's advertisements was flat in January compared with a year earlier, signaling that the Internet titan's growth engine may be sputtering.
First, this is only one month (after a solid December). Second, it's only for the U.S. (52% of its global ads). Third, there's isn't enough data to draw significant conclusions.
Consumers may be cutting back on their spending and therefore less interested in clicking on ads. Or advertisers, waylaid by economic malaise, [may be] buying fewer ads.
Jordan Rohan, an analyst with RBC Capital Markets, is exactly right. He said: "We believe that investors' fear over weak-paid click data from comScore is overblown."
Having said that, Google, in my opinion, is not helping the situation by its comments like these:
[Google's executives] explained that they redesigned
the ads so that fewer users would accidentally click on
them. As such, advertisers may be willing to pay more
for each time a user click on the ads, offsetting any
financial hit from a drop in clicks, some analysts said.
Are they talking about that superficial change to recent Google policy which deactivated the ads in the area besides the title and URL? (I can't imagine what else they're referring to.) Do these socalled analysts have any idea how insignificant those changes were?
I have seen no data differences since it was implemented. I don't see hundreds of publishers complaining they've suffered a huge "financial hit," either.
joined:Oct 27, 2001
I'm more disappointed with investors than I am with Google.
Are you sure you don't mean "speculators"?