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Yahoo Warns of Slowing Internet Advertising Sales
narramissic writes "Yahoo chairman and CEO Terry Semel warned that a slowing U.S. economy is starting to impact ad sales, particularly in 'autos and financial services.' But Yahoo was careful to note that it cannot tell whether the current slowdown is a sign of broader trouble or is limited to ads from the auto and financial sectors."
Sorry for being a cynic, but I don't see how a decrease in financial services or car ads are a bad thing.
... whatever, dude. In reality, most of them can't "beat the market" and all you get is the honor of paying them usurious fees for their stock-picking "wisdom".
1) Cars: auto sales are currently a big cartel. Every state has regulations stopping or significantly shackling internet sales of new cars. All that auto dealerships now offer you is the degrading process of "oh, gee, I dunno, I'm gonna have to talk to my boss about that offer you just made" and "here is a payment plan we can offer you in which I'll only talk about the monthly payments and hide the effective 14% interest rate that amounts to".
2) The financial services industry basically revolves around convincing people to invest with them to "beat the market". They thrive on artificially increasing the complexity of investing. I've had a financial advisor tell me that my investment plan is going to look "totally different from the guy in the next cubicle". Yeah, same age, same investment horizon
We really do need less of these ads. Is there something bigger I'm missing?
Apology to Ubuntu forum.
Hmm, ad sales slowing down in sectors that are strongly sensitive to interest rate changes, at a time when interest rates have been ramped up by the Federal Reserve (who are only now starting to talk about slowing this rate hike campaign)? Color me somewhat unsurprised. A sharp dip in a few sectors is less worrisome to me than a shallower dip across the board. If the broader ad market begins to slump and does so for a few quarters in a row, yeah, it might be time to rethink all those old-but-new-again ad revenue dependent business models out there.
News for Geeks in Austin, TX
Also, US Economy != World Economy, influences be damned. Is the global economy slowing overall, or no?
After RTFA, I think someone was trying to short some Yahoo stock more than make an accurate forecast...
Quo usque tandem abutere, Nimbus, patientia nostra?
1) There is a downturn in Auto advertising and FS advertising
2) Yahoo are getting a smaller slice of the advertising pie
If you were the CEO, which option would you talk about?
An Eye for an Eye will make the whole world blind - Gandhi
While there are always "signs" that point to "weaknesses" in the economy, most of what is out there is FUD spread by the mainstream media. The reality is that the current administration picked up the pieces of the .com crash and 9/11 and has done a remarkable job energizing the US economic engine through tax cuts. I encourage you to read the following piece by respected economic advisor Lawrence Kudlow: http://www.realclearpolitics.com/articles/2006/07/ the_bigbang_story_of_us_privat.html
Here's a few points:
- Did you know that just over the past 11 quarters, dating back to the June 2003 Bush tax cuts, America has increased the size of its entire economy by 20 percent?
- In less than three years, the U.S. economic pie has expanded by $2.2 trillion, an output add-on that is roughly the same size as the total Chinese economy. (so much for the "China is going to surpass us anytime soon theory - ed.)
- Since the 2003 tax cuts, tax-revenue collections from the expanding economy have been surging at double-digit rates while the deficit is constantly being revised downward.
Housing MAY cause some short-term pressures (though I think this will be more isolated than is being reported) but it certainly isn't going to cause the economy to come to a halt. Maybe Yahoo should take a look at Google's numbers which, if I'm not mistaken, are doing just fine on the ad revenue side. Perhaps Yahoo should take a look in the mirror before proclaiming this is a US economic problem. When all the indicators show that online advertising rates industry-wide are down for multiple quarters I'll listen. Until then, this looks like short-term CYA by a CEO to help explain why his SG&A and EBITDA are not meeting the numbers the analysts want to see next quarter.