Google Adsense Earnings Down As Social Networking Monetization Proves Difficult

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Google had lower than expected earnings, and a big part of the reason is because they had a difficult time monetizing the social networking space, and guaranteed payments they are making to Fox for MySpace is causing a greater than expected loss.

Sergey Brin says not to worry, the company is innovating and should have an answer.

“We have a huge amount of social networking inventory, including the MySpace relationship,” Mr. Brin said. “I don’t think we have the killer best way to monetize social networks yet. We are running a lot of experiments and we have had some significant improvements. But some of the things we were counting on in Q4 didn’t pan out. There were some disappointments there.”

Of course, the main type of experimentation they’ll be doing is format and placement.

It’s not hard to understand why monetizing at MySpace could be difficult. A vast part of your audience is internet marketers, their robots, and kids.

Until Google can figure out a way to get a 14 year old to quit listening to a song and go purchase a product, the deal with MySpace may never pay off.

We’ll see what innovations they make in the coming months.

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