💾 Archived View for gmi.noulin.net › mobileNews › 4288.gmi captured on 2023-09-08 at 18:01:36. Gemini links have been rewritten to link to archived content
⬅️ Previous capture (2023-01-29)
-=-=-=-=-=-=-
2012-10-23 04:28:53
Oct 18th 2012, 21:53 by M.G.| SAN FRANCISCO
EARLIER this week, Google caused a stir on the internet by revealing photos of
the inside of its data centres, which are generally kept off-limits to prying
eyes. On October 18th it caused an even bigger stir on Wall Street when details
of the company s financial results for the third quarter of 2012 were
accidentally revealed to the market before they were approved for publication.
The contents caused Google s share price to fall sharply, wiping off more than
$22 billion of its market capitalisation before trading in its stock was
suspended on the Nasdaq market while the firm sorted out the snafu.
The exact chain of events that led to the mishap is still unclear, though
Google has said that R.R. Donnelly, its securities filing agent, issued the
earnings release prematurely. (R.R. Donnelly said it is fully engaged in
investigating the matter.) The draft even contained the words PENDING LARRY
QUOTE , which referred to missing words of wisdom that had yet to materialise
from Larry Page, Google's boss. Wags on the web were quick to fill in the gap
on a Twitter feed, @PendingLarry, with suggestions that included Man, our
privacy was WAY violated today and Somehow, I ll find a way to blame today s
early release on Apple Maps .
But the rest of the release s contents and the fact that it was released
unexpectedly, roiling the market were no laughing matter. Google s net profit
fell by a fifth compared with the same period of 2011, to $2.2 billion. And its
average revenue per click fell by 15%, fuelling fears that the company s core
advertising business is being affected by the fragile economy and the steady
shift of search activity from desktops to mobile devices, where it is tougher
to monetise.
When Mr Page s actual quote finally materialised in the definitive earnings
release, it stressed that Google had seen revenue rise 45% year-on-year in its
latest quarter, to just over $14 billion. That is indeed impressive. But the
costs of everything from those data centres (whose multi-coloured innards are
now on display) to the restructuring of Motorola Mobility, its struggling
mobile-device maker, have been rising fast.
Fixing Motorola swiftly and finding new ways to drive up advertising sales,
which account for most of Google s revenues, are a top priority for Mr Page and
his team. But they face an increasingly complex regulatory landscape, which
could hamper their efforts. Earlier this week 27 European data-protection
agencies issued a statement calling on Google to clarify how it is processing
and storing users data, and to give folk more control over how information
about them from different Google services they use is combined by the company.
Such changes would hamper Google s efforts to drive up its ad revenues, but the
regulators have made clear that if it fails to act within a few months it could
face fines or legal action.
Watchdogs on both sides of the Atlantic are also investigating whether Google
has used its search engine to favour its own services unfairly. The company is
said to be trying to negotiate separate settlements with both the European
Commission s antitrust officials and America s Federal Trade Commission in
order to avoid protracted legal wrangles. But it is not yet clear exactly how
the negotiations will play out. Answering a question about this issue posed at
a conference that Google organised in Arizona this week, Mr Page noted that
over-regulation of the internet and restrictions on what people can do is a big
risk for us . That might be a good quote to include in Google s next earnings
statement.