During its first-quarter earnings call on Thursday, the search giant tried to assuage analysts’ long-running concern that its growth is slowing because mobile phones, with their tiny screens that can be clumsy to click through, are a less lucrative advertising medium than the desktop computers with which the Google empire was built.
In doing so, Patrick Pichette, the company’s chief financial officer, who is leaving, noted that Google’s YouTube video site has been growing fast but for now is simply a less lucrative business than Google’s highly targeted search ads.
“As you know, video ads generally reach people earlier in the purchase funnel, and so across the industry they tend to have a different pricing profile” than that of search ads, he said.
While Google remains the dominant search engine, its grasp on the mobile market is slipping in the face of increased competition from “native” applications designed for pocket-size devices.
Adding to his statements about YouTube’s lower ad prices, Mr. Pichette said that Google’s overall ad rates grew across desktop and mobile searches. Google does not detail YouTube’s quarterly performance. >more