Google Kills Its Radio Star

How much longer will the world’s biggest Internet company try to keep a finger in the TV advertising pie?

That’s again the inevitable question after Google disclosed yesterday that it’s snuffing out its radio-ads business unit, resulting in up to 40 layoffs.

The move comes three weeks after the Googlers bailed on their much-ballyhooed newspaper project. (See Google Stays Tuned to Television, But Pulls Plug on Print Ads.)

In explaining the decision to exit the radio advertising business, which sold inventory on some 1,600 FM and AM stations in the U.S., Google VP of product management Susan Wojcicki (in a blog post, natch) said it wasn’t paying off.

“While we’ve devoted substantial resources to developing these products and learned a lot along the way, we haven’t had the impact we hoped for,” Wojcicki wrote, echoing the words her newspaper counterpart used to announce the demise of Google Print Ads last month. The company will try to sell off the radio automation business, which it picked up with the January 2006 acquisition of dMarc Broadcasting for $102 million.

So the bright guys at Google couldn’t crack newspapers or radio. Will they have the appetite to stick with TV?

The company claims, for now, that it’s still in the TV biz. Wojcicki said Google will “continue to invest in our growing TV advertising business, where we can measure audience response and help advertisers understand how effective their ads are.”

Well, measuring audience response was precisely one of the supposed benefits of Google’s radio-ad product: “Using call reporting and integrated Google Analytics tools, you can track customer calls, website conversions, revenue, and other metrics to measure the impact of your radio campaigns,” the Audio Ads promo page says.

Also note that in TV-land, Google for the foreseeable future will not be raking it in. The company is the go-between for an unknown amount of ad inventory from Dish Network, six NBCU cable nets, Bloomberg TV, and Hallmark Channel. Only Google knows how much, but it can’t be very significant.

For a company with a core business that throws off mountains of cash (Google net profit for 2008 = $4.2 billion), picking up pennies from the floor of the television industry doesn’t seem like a very attractive long-term proposition.