Marketing

Google Stays Tuned to Television, But Pulls Plug on Print Ads

1/25/2009 8:10 AM Eastern

Google has folded its hand in newspaper advertising, but for now the company is still in the TV game.

The search engine giant, which generates 97% of its revenue from Internet advertising, disclosed in a blog last week that it was ending Print Ads. That initiative, launched in November 2006, was an attempt to sell ad space in more than 800 U.S. newspapers.

“While we hoped that Print Ads would create a new revenue stream for newspapers and produce more relevant advertising for consumers, the product has not created the impact that we — or our partners — wanted,” Spencer Spinnell, director of Google Print Ads, wrote in a company blog.

Google representatives said the decision has no bearing on the TV product, which became widely available last year. “We evaluated Print Ads on its own and have no plans to change Google TV Ads,” spokesman Brandon McCormick said.

The company, which posted a $4.2 billion net profit on $21.8 billion in revenue for 2008, emphasized its potential TV reach. Through a deal with Dish Network, it can sell ad spots in local ad avails on some 96 national channels reaching 13.7 million satellite TV subscribers. Google also sells national airtime for Bloomberg TV, and will soon add inventory from six NBC Universal cable networks and Hallmark Channel.

Still, neither Google nor its TV partners are willing to disclose how much ad inventory is placed through the TV Ads system so it's difficult to gauge its progress.

Trevor Fellows, Bloomberg's head of global advertising sales, said early indications are that the Google program is working even better than expected. The company's financial network has increased the amount of inventory made available through Google TV Ads since launching in early November.

“Brands are coming to Bloomberg TV that haven't used it before,” Fellows said, though he declined to name those advertisers.

Google will have to find a way to compete against — or work with — Canoe Ventures, the advanced-advertising joint venture set up by the six biggest MSOs, which is gearing up to launch its first services this year.

“The question will be, I think, whether the Canoe endeavor is intended in part to cut Google off at the pass and, if so, whether it will be successful in allowing the MSOs (and possibly telcos) to act as 'their own Google,'” Pike & Fischer chief analyst Tim McElgunn said.

September