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Google brake as ad budgets cut
Bill Condie, Evening Standard21.10.08
Online search giant Google will make fewer acquisitions and take on fewer staff amid the global economic turmoil, chief executive Eric Schmidt said.
Advertisers' budgets are "under stress", he added Profit growth slowed to its lowest this year in the last quarter as some advertisers cut back on ad space to reduce costs. But shrinking ad budgets have hurt newspapers the most, Schmidt told Bloomberg television.
"All of us are vulnerable. It's a race between a contraction in advertising, which would affect everybody, and a very positive shift from offline to online," he added.
Investment bank Collins Stewart says the credit crunch may lose the online-ads business $6.7 billion (£3.89 billion) in sales to 2010. Google shares have fallen 45% this year but the company last week posted a 26% net profit rise to $1.35 billion for the third quarter.
