Web Giant Google to Face Crisis

Google has seen its reputation as the world’s most powerful Internet firm rattled due to worry over its decreasing Internet ad sales, its major revenue source.

Media outlets including The Associated Press said Internet research firm comScore announced that Google’s “paid clicks,” one of the portal’s major revenue sources, fell seven percent in January from the previous month and slightly decreased from the same period last year.

Following the announcement, Google’s share price on NASDAQ fell 4.5 percent from Tuesday to close at 464.19 dollars. Reports said Google’s stock has fallen a whopping 37.8 percent in three months from its annual high of 747 dollars recorded in November last year.

Institutional investors blame the U.S. economic slowdown as affecting Google’s paid clicks. Other experts say Microsoft’s attempt to buy Yahoo!, Google’s main rival, has also hurt Google’s share price.

Swiss investment bank UBS lowered Google’s stock price target from 650 dollars per share to 590 dollars. BMO Capital Markets cut its stock price target for Google from 690 to 590 dollars.

In contrast, Yahoo!, which has emerged as Google’s competitor after Microsoft’s acquisition proposal, said it has tested “Yahoo Buzz,” an upgraded version of its Internet search program.

Yahoo! said the new system allows media outlets to determine how to link research results by themselves, and Yahoo! users to determine which content will appear on the Yahoo! homepage based on the results of polls or search frequency.

nex@donga.com