Google’s parent company, Alphabet, is preparing for a slowdown in its core digital advertising business. The company showed slowing ad revenue in its first quarter of 2019 and a decline in profit from the previous year in the third quarter.
Chamath Palihapitiya pointed to the travel industry, calling Google’s travel efforts a “canary in a coal mine” and citing both Expedia and TripAdvisor. “At the core of it is the decision that they will capture the overwhelming majority of profit in the travel sector,” he said about Google.
Shares of Expedia and TripAdvisor both reached new year-to-date lows this month, after both companies blamed Google for favouring its own search results.
Altimeter Capital CEO Brad Gerstner, who was interviewing Palihapitiya, chimed in on the conversation.
“TripAdvisor, who is one of the biggest free riders in Google — free search — is now the one who’s lost the most equity value as Google harvests free search into paid search.”