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Google and Yahoo: A Tale of Two Online Ad Markets

October 16, 2008
by Miguel Helft
Reporter, New York Times

Miguel Helft

In the next week, the two biggest sellers of online ads, Google and Yahoo, will disclose their third-quarter financial results. They are expected to report widely different results which mirror the increasingly diverging fortunes of two forms of online advertising: search ads and display ads like banners and video clips. Most analysts believe that the search advertising market — Google’s bread and butter and a business that the company overwhelmingly dominates — is holding up relatively well despite the economic downturn and the financial crisis. On the other hand, the display advertising market, which accounts for roughly half of Yahoo’s revenue, is suffering both from the deepening crisis and from a glut of Web pages, or inventory, that advertisers can choose from.

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