Google shares flat after plunge - Telegraph.co.uk

As Sameet Sinha, an analyst at B Riley, puts it, "Search is happening more and more outside of Google, meaning people are searching more through apps rather than through Google search. That could indicate a secular change, especially when it comes to ecommerce searches. The big fear has always been what if people decide just to go straight to Amazon and do their searches? And potentially that's what could be happening."

Google argues that, thanks to its Android operating system and its market-leading position, nobody is better placed to make money from search, wherever it happens. And it's true that Android allows the business to embed chances to monetise users at every opportunity. As Facebook has found out to its cost, however, it's a tricky proposition, however it's handled. Their already troubled shares fell yesterday too, indicating that markets lack confidence in tech stock whose outlook changes faster than in any other sector.

Still, it would be a mean-minded commentator who says Google's figures today are the beginning of the end; and it would be even meaner to say the challenges those figures reveal are not ones that Google has more than seen coming. Its share prices have hit record highs recently, even though nobody is close to cracking the mobile problem yet – it would be brave, too, to suggest that Google has the answers that will see its shares rise rapidly in the future. This week could offer a foretaste of things to come, as the mobile phone revolution takes a real hold on the technology giants who built their fortunes on the desktop PC. Even so, the falls are as much a course correction, in part also down to Motorola's sagging earnings, as they are a sea change.

Boston Consulting Group analyst Colin Gillis sums up the situation: "We have been saying this thing was ripe for a pullback. It's not like they're Google not being Google, but you still have some major issues. Click prices declined for the fourth consecutive quarter after rising for eight consecutive quarters before then. That's a negative. This is the mobile problem."