Google said today that it's jumping ship on the radio ad business, less than a month after it pulled the plug on a print-ad project. It said that it will phase out the existing Google Audio Ads and AdSense for Audio products, has plans to sell the Google Radio Automation business, the software that automates broadcast radio programming, and will lay off about 40 people. The company said it will instead focus its efforts on online streaming audio ads.
Last month, after Google dumped newspaper ads, I said that Google never really belonged in the dying newspaper ad business. Albeit a noble effort, the harsh truth is that it's not Google's responsibility to save newspapers. The same could be said about radio.
Google's exit from the radio advertising business isn't all that surprising. Pure play radio companies can't sell their own ads. How is a newcomer like Google supposed to do it? Meanwhile, business is brutal. Clear Channel tapped its credit facility and sparked bankruptcy worries. Other publicly traded radio companies, such as Cumulus and Sirius XM, are trading for pennies. Simply put, radio is an ugly business right now. (Disclosure: CBS, the parent of ZDNet, also has a radio division.)
But "audio" - as opposed to radio - may be a better play for Google. In a blog post, Product Management VP Susan Wojcicki wrote about the move into ads for online streaming audio:
Instead, we will use our technology to develop Internet-based solutions that will deliver relevant ads for online streaming audio. We are dedicating a team of people at Google to explore how we can best add value for advertisers, broadcasters and listeners in this emerging advertising space.
It wasn't even a month ago that Google - which already had promised to scale back on projects that weren't producing results - said it was shutting down a print-ad project that started in 2006 with 50 newspaper partners and grew to more than 800.
Again, newspapers can barely sell ads on their own. Just because Google - which transformed online advertising - stepped in as a partner doesn't make a newspaper ad more attractive. In the end, Google said the product had not "created the impact that we - or our partners - wanted."
The company said today that it "will continue to invest in our growing TV advertising business, where we can measure audience response and help advertisers understand how effective their ads are."