This debate has been going on for almost a year now. Google’s stock price came under fire around the end of last year and the beginning of this year because of concern that the search giant might see a downturn in ad spending that would hit the bottom line. Has it? A little, but not a huge amount (although some say that could change). In fact, there are those who argue that search-related ad spending is likely to be the most durable even in a shaky economy — in part because businesses can get more bang from buying AdWords than a newspaper ad or TV spot.
Not the most auspicious person to contact for something that even relatively pro-advertising music fans might see as an abomination, but Mr. Kluger sees as “the opportunity of a lifetime.” Rather than dismiss his email, however, Crouse responds enthusiastically:
There’s no question that the Glam Media story is an appealing one: the company says that it has more than 65 million unique visitors across its network — although as Mike Arrington has pointed out in the past, that figure is an aggregation of all the visitors who come to any of Glam’s partner sites. He also noted in that post that Glam owns a bunch of pure SEO plays such as free-beauty-tips.com and so on. In a previous VentureBeat story, one critic called Glam “Boo 2.0,” referring to the Bubble 1.0 shopping site — and Matt Marshall noted that half of Glam’s total pageviews came from a single site (MyYearbook.com).
Still, the network has grown at a fairly impressive rate, and counts some prominent sites like E Online as partners — and has just launched a fairly sophisticated video content/advertising system as well. According to PaidContent, the company gets a whopping $50 CPM on some of its video ads. But to turn down a $1.3-billion takeover offer? As Erick Schonfeld notes at TechCrunch, that’s almost 9 times estimated revenues and 33 times estimated profit. Either Glam’s financial backers have gotten greedy, or someone has been drinking an awful lot of Web 2.0 Kool-Aid.