Thursday, October 18, 2012

Google Q3 report clouds future of mobile ads

As Gannett pours more resources into smartphones, tablets and other mobile devices, a disappointing Google earnings report this afternoon raised fresh doubts about publishers making money in an increasingly mobile world.

The third-quarter report showed Google is "grappling with the mobile revenue riddle," says The New York Times. "And Google is not alone. The problem is also stumping technology companies like Facebook, Apple and Microsoft. Just as the Web upended traditional business models for print publications more than a decade ago, now mobile is disrupting Web businesses."

The search giant said the price advertisers paid per click on an ad fell 15% from the same period last year. This was the fourth consecutive quarter that number declined, even as the number of paid clicks on ads climbed 33%, largely because people see Google ads on their phones on lunch breaks or in bed -- not just when they are in front of a computer, according to the NYT.

Investors were stunned. Google's stock plunged 8%, or $60.49 a share, to close at $695. The stock had been on something of a tear in recent weeks, trading as high as $774 early this month.

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