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Even Internet superstars fall to earth eventually. While recent reports of layoffs and other cost-cutting measures at Google have been greatly exaggerated, the search giant's culture of unbridled spending is finally coming to a halt. And that's probably a good thing. "Hard times have forced discipline on them," says Sanford Bernstein's Jeffrey Lindsay, who predicts, "They'll come back really powerfully. They can emerge as a much leaner and more competitive player...

Author: /time Magazine | Title: Even Google Gets Frugal in the Recession | 12/4/2008 | See Source »

...Internet company that has only one revenue source, which is advertising," says Chowdhry. He estimates that the company will bring in $14.57 billion by 2010, down 4% from an estimated $15.71 billion in 2008. Sanford Bernstein's Lindsay, on the other hand, recently lowered his upbeat forecast for the search giant but still expects a healthy 19.5% increase in revenue in 2009. (See pictures of "Life in the Googleplex...

Author: /time Magazine | Title: Even Google Gets Frugal in the Recession | 12/4/2008 | See Source »

...dire as Chowdhry's. But both analysts are reacting to reports that the cost-per-click for Internet ads has fallen an estimated 20% this year. Google and other Internet-advertising companies make much of their money by serving up ads that match keywords that people type into search engines. The rates for those ads are determined by advertisers, who bid for top placement. But advertisers have begun lowering their bids because they aren't getting the returns (also known as conversion rates) that they expected. In late November, research firm eMarketer lowered the 15% increase in online ad spending...

Author: /time Magazine | Title: Even Google Gets Frugal in the Recession | 12/4/2008 | See Source »

...Google needs to focus on its core businesses like search, mail and Web-based applications, instead of pouring endless resources into experimental projects that never turn a profit (such as its ill-fated virtual world Lively, which will close at the end of month). "If they could fix their expense management, surely they could fix their product development as well. Google has a very poor product-development process," says Lindsay, who criticizes the firm for letting good products languish while encouraging engineers to tackle newer and more exciting projects instead. For example, its Chrome browser got positive reviews when...

Author: /time Magazine | Title: Even Google Gets Frugal in the Recession | 12/4/2008 | See Source »

...decade later, it still shows up on best-seller lists. Indeed, Who Moved My Cheese? has become the best-selling business book ever, with more than 22 million copies sold worldwide in 37 languages. That's bigger than Good to Great and In Search of Excellence, case-study-laden books that examine corporate success in detail. There is a cult of Cheese, populated by readers (some of them CEOs) who extol the virtues of the book and claim that it has changed their workplace and even their personal life. "I love that book!" says Vijay Govindarajan, a professor at Dartmouth...

Author: /time Magazine | Title: Business Books | 12/4/2008 | See Source »

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