Google Terminates Radio Ad Biz

Feb 12, 2009 4:24 PM

San Francisco – Feb 12, 2009 – Google, which has a hand in many businesses, is pulling that hand out of one: radio. In 2006, Google started Google Audio Ads as a means to connect business wanting to advertise on the radio with available radio inventory. Google has decided that the effort is not working, so the company is dropping it. In addition, Google will sell the radio automation business. Online reports speculate that up to 40 people will be laid off because of the change. Advertisements currently running though Audio Ads will remain in place until May 31.

Last month, Google also abandoned newspaper and print ad placement service.

Google sent this message to its automation system customers:

Dear Valued Customer,

As you may have heard, beginning on May 31, we will discontinue the current Audio Ads feature within Google AdWords. We have also decided to exit the broadcast radio business and focus our efforts on exploring internet-based solutions that will deliver relevant online streaming audio ads. As part of this refocus, we plan to sell the Google Radio Automation business.

We are committed to making this a seamless transition for you. Your automation system will continue to operate, and you will be able to access our support, sales and business operations teams as before. We understand how important our automation system is to your operations and will continue to communicate with you throughout this process

We appreciate your continued partnership. Please let us know if you have any questions.
Sincerely, The Google Radio Automation Team

Google purchased the radio software business from Dmarc, which Dmarc had previously bought from Scott Studios.

What does this say about radio advertising? Many speculate that radio stations feared Google’s courtship because of the potential commoditization of radio advertising. Hence, many stations refused the business plan. Some large radio groups including Clear Channel signed agreements with Google, but the service does not appear to have proved financial viability.

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