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Google experiments with placing print ads

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So how powerful has Google become?

Well, every time the search engine giant whispers, the interpretation of that murmur becomes a roar. "Google makes news five times a day," said Chuck Richard, an analyst at research and consulting firm Outsell.

This phenomenon could be seen late last month in the deafening avalanche of reports that followed CNET Networks' original scoop that Google had entered into deals with Ziff Davis Media's PC Magazine and Future Network's Maximum PC to buy space in the publications and then resell it to small advertisers in its network.

Google presented the arrangement as a small experiment. "Google is testing a program to place ads from our advertising network into U.S. print publications," said company spokesman Michael Mayzel. "This limited test is part of Google's continuing effort to develop new ways to provide effective and useful advertising to advertisers, publishers and users."

The oracular company would say no more, but a chorus of analysts lined up to read the entrails of Google's statement. The analysts differed on how important Google's move was.

"This is still an experiment, but the implications are a little mind-boggling," a newsletter from Outsell said. "Google is hedging against an inevitable slowdown of online ad growth, diversifying from its dependency on search-based ads and setting itself up as a single source for multiple advertising options."

Charlene Li, an analyst at Forrester Research, said she foresees big implications in Google's partnership with Maximum PC and PC Magazine. "Their biggest asset is their huge stable of advertisers," she said, estimating that Google's advertising base was more than 200,000 and maybe as many as 300,000.

Li said that if Google's experiment shows any promise, the company will not stop with partnering only with print. "What's amazing is that no one has talked about radio or TV," Li said. "Why wouldn't they-especially with radio? It's mu ch more direct response-oriented." She also noted that TV stations sell many direct response ads that run "at 2 o'clock in the morning."

Gary Stein, an analyst at Jupitermedia Corp., also said he sees huge implications in Google's print partnerships. Stein said Google may be able to help print, a notoriously difficult medium to measure, prove its return on investment. "We keep hearing that it doesn't matter what fancy URL you put in your offline campaign," Stein wrote in a note. "People go to search engines and search for your product name. Google is in a position to know that the call-to-search effect is happening for the print ads they are running."

And while some viewed Google's move as yet another threat to print, Jason Young, president of Ziff Davis Internet and Consumer Tech Group, disputed the notion that the sky is falling for magazines. He said Google's experiment is proof that even the king of the Web sees print as a potential revenue generator. "It's a fantastic validation of what the strength of the print market is," he said.

Young also pointed out that Google appeared to be no threat to seize control of any magazine, either from an editorial or advertising standpoint. "We're talking about fractional ads in the back of the book," he said.

Young said he welcomed Google's aid in mining its large network of small advertisers and selling what he said amounted to "classified ads." "Google has relationships with hundreds of thousands of smaller marketers that we could never serve directly ourselves," he said.

The incremental ad revenue for a publisher such as Ziff Davis is similar to Google's online AdSense program, which places contextual ads on cooperating Web sites.

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