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Thursday, December 4, 2008

Google Finally Showing Signs It’s Not Completely Recession Proof

Posted by @ 5:19 pm
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If your business has been feeling the pinch with all the economic doom and gloom, don’t think you’re alone. Even Google, whom we thought might be recession proof, is tightening its belt.

Reports have emerged this week that the world’s largest search engine is cutting costs and axing projects in light of the dismal financial forecasts.

The Wall Street Journal summarized Eric Schmidt’s (Google CEO) thoughts on the cost management initiatives.


“We have to behave as though we don’t know what’s going to happen… The
company will curtail the “dark matter”…projects that haven’t really caught on
and aren’t really that exciting. The company is “not going to give” an engineer
20 people to work with on certain experimental projects anymore… When the
cycle comes back, we will be able to fund his brilliant vision.”

So what Google projects and initiatives been given the axe? Here’s some of the victims:

  • Searchmash – a test version of the search engine used for trialling UI enhancements
  • Lively – their foray into the virtual world space
  • Ad free web services (Finance and soon News will run ads to generate revenue)
  • Free time for engineers to work on personal projects (used to be 20% of their work week)
  • Reduced hours at its free cafeteria
  • …and layoffs of contract workers are in the pipeline

Those are just some of the changes and cuts that the search behemoth has actioned to help position it for a slightly less certain future.

Cost management aside, Google is still holding its own in the current market, with growth of 31% in the 3rd quarter compared to last year.

And given marketing spend continues to shift online as businesses seek measurable advertising options, the company is positioned to ride out the economic storm comfortably.



Rene LeMerle Rene is the marketing manager of ineedhits.com - a global search engine marketing company. He also leads the marketing for Gooruze.com - a web 2.0 style community for online and digital marketers. Rene has been in the industry since 1997 with much of that time spent helping businesses embrace the best of the internet and digital world.

View Rene LeMerle's profile






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