|
Tel Aviv, Israel-based Web email firm IncrediMail, a fast-growing publicly traded company with more than  10,000 customers, has seen its advertising service partnership with Mountain View, California-based Google's AdSense program halted by the search leader, sending shares of IncrediMail down more than 40 percent. In a statement issued Friday morning IncrediMail, which allows Web users to send customized emails, gave no reason why Google ended its partnership with the email software company. IncrediMail reports that it has "received a notification from Google, stating that Google decided to stop the AdSense partnership with the company and therefore it is disabling ads to search result pages displayed through the company's account, and in addition that the company's AdSense account has been disabled," IncrediMail said in its statement, referring to the popular program in which publishers display Google's relevant text based advertisements on their Web sites in exchange for receiving nearly 80 percent of revenue generated on a per-click or per-thousand-impressions basis. IncrediMail made public that over the past two years its revenue has been helped significantly through Google's AdSense program. "In 2006 and 2007, search revenues powered by Google’s AdSense program made a significant contribution to the Company’s results," IncrediMail said. While details of Google's decision to stop the AdSense partnership with the email firm have not been made available, IncrediMail said in its statement it is "currently clarifying the matter with Google and simultaneously exploring alternative relationships, with Google and other vendors." In addition to selling software, IncrediMail sells advertising, sponsored links and keyword search services, and database subscriptions. Immediate Impact on IncrediMail Shares News of the collapse of the partnership between the two firms sent IncrediMail's share prices down to $2.50,  the lowest seen this year, and far below last year's high of $10.69 and the record revenues it announced in November 2007. The previous low for a share of company stock was $4.46. Analysts and other AdSense users have expressed mixed feelings about the partnership termination. "This announcement is a big blow for IncrediMail as we believe that approximately 85 percent of the company's advertising revenues are attributable to its AdSense relationship," said Matthew Weiss, a Maxim Group analyst, in a recent Associated Press article. During the first nine months of 2007 IncrediMail revenues climbed 94 percent to $13.3 million, according to figures released in November 2007. Swift Reaction from AdSense Users Among members of the popular online discussion forums operated by WebmasterWorld, a community of mostly technically savvy webmasters and search engine marketing (SEM) professionals founded by chief executive Brett Tabke, reaction to IncrediMail's Friday statement was swift and included several guesses as to why Google severed the AdSense partnership. "To me it would appear it probably conflicts with [Google's] GMail service," wrote one member using the handle "ByronM", referring to Google's own web-based email system. Others expressed relief that Google may be taking steps to keep its AdSense program functioning as well as possible. "[I'm] glad to know that the integrity of AdSense is being maintained," wrote a member using the handle "ecmedia". Other WebmasterWorld members felt sympathy with IncrediMail's loss of AdSense revenue, such as "paris" who noted, "Getting banned from AdSense is never fun. Imagine being a publicly-traded company, with 10 million active users, relying on AdSense for a good chunk of your revenue." Another WebmasterWorld member wonders whether Google rivals Yahoo and Microsoft, both of which offer revenue sharing advertising programs similar to AdSense, may step in and offer their programs to IncrediMail. "I am pretty sure you will see Yahoo or Microsoft has made a better deal to them," wrote a member using the handle "bwnbwn". "On the flipside, this could be a boon to [Microsoft's] AdCenter or [Yahoo's] YSM if they land a deal. 10 million users is a large population to ignore," the member added. Google Stops AdSense Partnership with Email Firm IncrediMail IncrediMail is believed to be the first publicly traded company to have its partnership agreement with Google's AdSense program terminated, although the reasons for the separation are not yet known. "Who says they abused their account? Perhaps IncrediMail was negotiating for a better payout and Google terminated the agreement pending final resolution," asked a WebmasterWorld member using the handle "edge". Google's AdSense program accounted for $1.45 billion of Google's $4.23 billion online advertising revenue generated during the third quarter, well ahead of second place Yahoo's $1.5 billion and third place Microsoft's $700 million. Related Links:
|
12:03 am on Jan. 12, 2008 (utc 0)