Sure, Google has Google Apps to wave in front of Microsoft’s face when it gets too serious with Bing, and Microsoft keeps pressing on its online-ad business to keep Google from thinking too hard about Chrome OS. But is Jenkins right?
Do these two rivals really want to upset their cozy corners of dominance in order to take on profit margin-busting forays into their competitors’ markets? Read More…

Shortly after Tim Armstrong took over as chief executive of AOL, he asked to see the list of business deals that were being negotiated. He saw 900 of them.

It was too many by far. “If you looked through the deal sheet, would you have been able to see the strategy of the company?” he asked. “I had a hard time.”

The deals were small and incremental. At best, he said, “you would have thought it was a small- to medium-size Internet company.”

Mr. Armstrong wants AOL to think big again. Three months after leaving a senior job as Google’s president of advertising sales, he is formulating his ambitious recovery plan for AOL. He wants to make AOL the biggest creator of premium content on the Web and the largest seller of online display advertising. Read More…

The other day, I was at the paidContent EconAffinity conference fighting the urge to fiddle with my BlackBerry when an entertaining spat broke out among the panelists. The session was called “Online Advertising: Is Turning to Behavioral Targeting and Bigger Ads the Answer?” and was ably moderated by the exuberant Wenda Harris Millard. She was, like the rest of us, rather enjoying the ruckus, which was sparked when Mike Keriakos of Waterfront Media told Andy Monfried of Lotame where he could stick his ads, and Andy addressed the audience with a dramatic (although not terribly original) soliloquy about buggy whips. Things then got a little heated.

Underlying all of this was a number of serious points about the past, present and future of advertising online. Partly to avoid putting the wrong words in either Andy or Mike’s mouths, I’ll proceed with my take on the issue.
When I think about old media, it strikes me that it has been very good at relationships with advertisers and rather poor at cultivating relationships with its consumers. The thing about digital media is that it has gone way too far the other way. Audiences are center and front of successful Web sites and, of course, the whole kit and caboodle when it comes to social media. Advertising, on the other hand, has been commoditized. Read More…

Of the big three search engines, one could argue that Google is directing the most focused, ongoing effort toward mobile. Clearly Yahoo and Microsoft see mobile as a critical part of their business but Google is more or less continually doing things that seek to improve the mobile user experience.

First, of course, there’s Android itself. And then there are Android apps like Places Directory (a local search app minus the search part). There’s also the effort to improve and expand Voice Search and Latitude. There are the recent upgrades to GMail and iGoogle that make the mobile browser experience much more like a native smartphone application. There’s the recent expansion of Google’s Content Network (display ads) for mobile, as well as Google’s own display advertising for its iPhone app. I could go on for some time with items like this. Read More…

by Tom Krazit

Bing took a baby step up the search engine ladder in its first month on the Internet.

Microsoft’s share of the search market increased from 7.81 percent prior to the launch of Bing to 8.23 percent for the month of June, according to data from Statcounter picked up by Reuters. Bing got a noticeable bounce during the first few weeks of June, but settled back after the novelty wore off.

Google’s share dropped ever so slightly, from a dominant 78.72 percent of the search market in May to a perilously shaky 78.48 percent of the market in June, a drop attributed by more than a few news outlets to Bing’s success but one unlikely to cause too much concern in Mountain View. Statcounter was a lone voice suggesting that Bing surpassed Yahoo during its first week of existence, but now reports that Yahoo actually gained share during June in maintaining its second-place position, up from 10.99 percent in May to 11.04 percent in June. Read More…

Please click here to watch Google TV Ads Product Demo

Google has been working on more eye-catching ads to replace its text ads for awhile now and the emergence of Bing as an e-commerce site is hastening the search engine’s pace.

Reports claim that Google will be testing product ads for its users whenever they browse through Google.com.

In an e-mail sent to advertisers, the number one search engine described the new features for the Google product ads.

The new ads “will feature product specific information directly in the ad such as price and product image,” the company said in the e-mail. “During the beta program, Google will be testing to identify the most effective ad formats. Google product ads will complement standard text ads on Google.com and will run independently during the beta.”

Microsoft’s Bing has a Cashback program, which apportions ad revenue to consumers for some of their purchases. It is developments like this that are making Google more aggressive in pursuing online shoppers.

Read More…

WHILE FOREIGN-EXCHANGE rates (F/X) remain a headwind for year-over-year comparisons, a quarter-over-quarter decline in the dollar should translate into sequential revenue gains and profits for the major Internet software and services companies in the second quarter, with Google (ticker: GOOG), Amazon.com (AMZN) and eBay (EBAY) benefiting the most.

Among small-caps, VistaPrint (VPRT) stands to see a positive impact on sales but negative impact on gross margin given its Canadian dollar exposure.

With the dollar posting a 3.9% quarter-over-quarter decline versus the euro and a 7.2% decline versus the pound quarter-to-date, companies that generate a significant portion of sales from outside the U.S. (more than a third) should see a positive impact on revenue. That said, we note that on a year-over-year basis, the dollar is still up versus most currencies, and thus F/X will still serve as a headwind to year-over-year comparisons.

We expect Google (non-U.S. revenues were 52% in the first quarter) to see about $170 million in revenue gains from F/X quarter over quarter in the second quarter and 20 cents to earnings per share. Note that some or all of the sequential gains or year-over-year losses for Google are likely to be tempered by the company’s hedging program. Read More….