Google to ComScore: You owe us $15-billion


Earlier this week, comScore released a report looking at Google’s click-through rates for January, which showed a precipitous decline — and that in turn caused a similar precipitous decline in the company’s share price, slicing about $15-billion or so worth of market value from the stock in a single day’s worth of trading. Now, the traffic-measuring company says that it has looked more closely at the report and come to the conclusion that the decline was the result of Google’s attempts to improve the quality of the ads that are generated when people do a search.

The slide in Google’s shares wasn’t all comScore’s fault, of course. In some ways, it was like the proverbial straw that broke the camel’s back. Investors have spent the past few months getting progressively more and more concerned about the U.S. economy and the effects of a recession on online advertising — and Google is the poster child for online advertising, since that makes up about 90 per cent of its revenues, and therefore justifies about 90 per cent of its multibillion-dollar valuation. All those fears were crystallized with the comScore report.

Still, it seems more than a little disingenuous for the company to be coming out with a fuller investigation of the click-traffic results after the horse has already stampeded from the barn, in a sense. Couldn’t comScore have seen this one coming? Given the nervousness around online ads, the news that click-through rates had fallen by 7 per cent in a single month was almost sure to set off a firestorm. It might have been nice to throw a few of those caveats in there at the time. Oh well — a billion here, a billion there. C’est la vie. I’m sure Google will get over it.

Comments (16)

  1. howardlindzon wrote::

    interesting times indeed as web 2.0 moves stocks around

    Saturday, March 1, 2008 at 2:27 am #
  2. Mark Evans wrote::

    comScore lost a lot of credibility by trying to create news without providing all of the facts or analysis at the same time.

    Saturday, March 1, 2008 at 7:36 am #
  3. David Hillman wrote::


    you're only getting to this story now?. zdnet, techcrunch, cnet, and a cast of thousands had it yesterday.

    Saturday, March 1, 2008 at 8:51 am #
  4. mathewi wrote::

    I'm not trying to be first, David.

    On Sat, Mar 1, 2008 at 8:52 AM, Disqus

    Saturday, March 1, 2008 at 8:58 am #
  5. Oli wrote::

    What the hell? Since when was blogging some competition to break every story first? Grow up, bugger off or do both.

    Saturday, March 1, 2008 at 11:51 am #
  6. Kevin Heisler wrote::

    Interesting analysis, Matthew. Always better to be best than first.

    You raised a key point no one else has addressed: comScore sells the proprietary research and didn't release it publicly. So only a few i-bankers reviewed the data.

    That led to an uninformed media frenzy that relied on a couple analyst notes.

    The outcome was predictable: doomsday scenarios for Google paid search advertising, wild speculation, anonymous “insider data” and finally, an intelligent discussion of what comScore data truly indicates.

    Great headline, by the way.

    Kevin Heisler
    Executive Editor
    Search Engine Watch

    Saturday, March 1, 2008 at 10:19 am #
  7. mathewi wrote::

    Thanks, Kevin. Henry Blodget made that point too, I think, when he
    pointed out that comScore hadn't talked to anyone at Google before
    they put together the report.

    On Sat, Mar 1, 2008 at 10:20 AM, Disqus

    Saturday, March 1, 2008 at 10:47 am #
  8. Thusenth wrote::

    I really respect what Google is doing with their position on the online advertising space. They aren't afraid to take 3 steps forward and then take 1 step back for the goal of making the 'internet a better place'.

    Last year, they pulled the plug on arbitrage and it killed a few companies like Geosigns that ran linkfarms and splogs. I'm sure it had adverse effects on Google also, but they did it anyways.

    The more transparent they are about such moves, I believe would make stories like this one non-existant.

    Saturday, March 1, 2008 at 12:14 pm #
  9. JoeDuck wrote::

    I like the straw breaking the camel back idea because the market should know better than to 1) trust a single report from Comscore that 2) the market watchers appear to have misinterpreted anyway. I'm still confused though – it almost feels like Comscore is covering their *ss in case of a lawsuit. The re-interpretation of the results is not very clear, in fact my read is that they are suggesting the data suggests that Google's Q1 will actually be better due to higher per click yields.

    Saturday, March 1, 2008 at 1:43 pm #
  10. William wrote::

    AdGooroo just released their quarterly research report on Google and Yahoo. It clearly shows that Google's quality algorithm cost them quite a few advertisers since July, but that they bounced back in Q1 (at Yahoo's expense). This seems to support the idea that earnings will be up.

    Thursday, April 17, 2008 at 1:53 pm #
  11. AlexFoley wrote::

    Exactly! The future of social media is in promoting content with the highest value. The current mass media model promotes content with too much emphasis on speed and not enough emphasis on authority.

    Thursday, June 12, 2008 at 3:52 pm #
  12. bigbigwatch wrote::

    Rolex Watches

    Breitling, Rolex, TAG HEUER


    Breitling Watches

    Computer Radiation Eliminator

    Replica Watches

    Cartier Watches

    Panerai Watches

    Bvlgari Watches

    Breitling Watches

    Tag Heuer Watches

    Patek Philippe Watches

    Rado Watches

    Mont Blanc Watches

    A.Lange & Sohne

    Piaget Watches

    Vacheron Constantin

    Frank Muller Watches

    Breitling Watches

    Longine Watches

    Hublot Watches

    Mont Blanc Watches

    Panerai Watches

    Chopard Watches

    Vacheron Constantin

    Bell&Ross Watches

    Rolex Watches


    Electromagnetic Radiation Eliminator


















    < a href="">义乌2元二元批发

    taylor made r7 cgb






    Sports Shoes Wholesal

    Wholesal Sports Shoes

    wholesale nike shoes

    nike shoes wholesale

    Radiation Protection Products

    japan txluck


    nike air jordan shoes






    nike shoes wholesale


    chinese tea wholesale





    runescape seo

    < a href="">Theonewatch Rolex





    < a href="">游戏外贸

    < a href="">游戏关键字优化

    < a href="">游戏优化

    < a href="">欧美网络游戏优化

    < a href="">莆田网络公司

    < a href="">莆田SEO

    < a href="">32.768晶振

    < a href="">金镶玉

    < a href="">何氏瓷艺

    < a href="">玉镶金

    < a href="">美工招聘

    < a href="">美工求职

    < a href="">网页设计师

    < a href="">童话故事

    < a href="">珠宝

    < a href="">珠宝贸易

    < a href="">Nike Shoes

    Sunday, September 21, 2008 at 9:57 pm #
  13. mathewi wrote::


    2008/9/21 Disqus <>

    Sunday, September 21, 2008 at 10:01 pm #
  14. Web Design wrote::

    I will always be on the Google's side and I think so far they would have been planned some strategy up to cover this if it really has existed. I think Google knows the right time to do things and this could be their major strength with this success.

    Wednesday, February 11, 2009 at 5:45 am #
  15. interesting… google are getting bigger and thus more power over other companies.

    Friday, September 25, 2009 at 6:22 pm #
  16. In truth, immediately i didn’t understand the essence. But after re-reading all at once became clear.

    Watch Movies For Free

    Sunday, January 3, 2010 at 9:20 am #

Trackbacks/Pingbacks (4)

  1. […] are down 7% Google says that this is because Google has "Improved" the quality of the ads that are returned when users do a search.  If that were true then […]

  2. Why ComScore owes Google $15 Billion | on Saturday, March 1, 2008 at 9:28 am

    […] stock got slammed recently due to numbers from ComScore. Here is a post on why ComScore should be writing Google a huge check and another showing how ComScore’s […]

  3. Blue Moat: The Market Makes Mistakes: Eg. GOOG on Saturday, March 1, 2008 at 11:24 am

    […] recent trouble with click through data. Of course, investors should be weary that the original ComScore “news” shaved approximately $15B, and somebody with a bunch of money on the lin…. None the less, even if revenue is going to be a little lower for Google, it’s temporary. It […]

  4. […] it’s not workingAfter comScore’s report on Google’s falling click-through rates, Google’s shares took a hit. So Magid Abraham and James Lamberti at comScore decided to take it upon themselves to clarify […]