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(Credit: ComScore)

Google gained share of U.S. search in April compared with rivals, ComScore said Wednesday.

Compared with March, the company gained 1.8 percentage points to reach 61.6 percent share, ComScore said. Yahoo dropped 0.9 percentage points to 20.4 percent, Microsoft dropped 0.3 to 9.1 percent, AOL dropped 0.2 to 4.6 percent, and Ask dropped 0.4 percent to 4.3.

Americans conducted 10.6 billion search queries total in April, a number that dropped 2 percent from March, ComScore said. That means Google increased its absolute number of queries 1 percent, but all the others dropped.

Google passed Yahoo in its share of monthly visitors in the United States for the first time this April, buoyed by growth in search and YouTube videos, according to ComScore statistics released Thursday.

However, underscoring the variability of this sort of measurement, which extrapolates overall data from the usage of a "panel" of users at home and work, ComScore rival Nielsen Online released its own data as well with some different results. Although it also showed Google as No. 1 in terms of unique users, it said Google passed Yahoo way back in January 2007.

ComScore said Google sites had 141.1 million unique visitors in April, a tad ahead of Yahoo's 140.6 million. Microsoft was in third at 121.2 million, with AOL at 111.3 million.

Nielsen's data showed Google at 128.2 million, Microsoft at 122.1 million, and Yahoo at 117.1 million.

Nielsen also provides information on time spent at the sites, though. There, Yahoo leads its rivals with 3 hours and 9 minutes per month, but AOL owner Time Warner leads Yahoo at 3 hours 40 minutes per month.

Microsoft's usage was 2 hours and 17 minutes, and Google was 1 hour and 47 minutes, Nielsen said.

ComScore, an analyst firm left holding the bag when Google's financial performance far exceeded analyst expectations, scrambled Friday to reconcile its pessimistic statistics with reality.

At the heart of the matter is a key Google advertising performance measurement called paid clicks--the number of times Web searchers clicked on one of the ads Google shows alongside search results. On Tuesday, ComScore reported Google's paid clicks grew 1.8 percent from the first quarter of 2007 to the same period in 2008. But on Thursday, Google said the growth actually was 20 percent.

The gap prompted Google Chief Executive Eric Schmidt to jab at ComScore on the post-announcement conference call. "Paid-click growth is much higher than has been speculated by third parties," he said. ComScore's stock dropped 8 percent in after-hours trading Thursday, but recovered most of those losses Friday.

Why were the numbers so different? Two major factors, according to a blog post Friday by ComScore's Andrew Lipsman.

First and most obvious, Google's 20 percent statistic was for the whole world, but ComScore was only measuring U.S. results, Lipsman said. (Collins Stewart analyst Sandeep Aggarwal said after Google reported results that paid clicks in the U.S. were up 10 percent.)

Second, Google includes clicks through its AdSense service, in which partner Web sites display Google ads and share resulting revenue, Lipsman said. He also said "strong revenue growth" from YouTube contributed to the difference and concluded that ComScore and Google actually were not that far off at all.

After walking readers through some math, Lipsman launched into the disclaimers.

"ComScore has always cautioned that there are multiple factors that needed to be considered when projecting Google's earnings this quarter," he said. "U.S. paid clicks alone would not tell the full story without considering cost-per-click increases, that macroeconomic factors did not appear to be weighing on Google, and that Google might well have solid revenue growth in the first quarter."

He tossed in a pointer to a February blog post by ComScore Chief Executive Magid Abraham and search Senior Vice Preisdent James Lamberti who tried to moderate the minor panic that ensued after ComScore released its January statistics.

Even if you don't understand ComScore's numeric analysis and don't like the disclaimers, there's one part you should definitely remember from Lipsman's post: Google's opacity places huge importance on ComScore's numbers.

So know what you're getting into before you use them as a basis to play the market.

What will Google's Schmidt have to say about the first quarter? We'll find out Thursday.

(Credit: Dan Farber/CNET News.com)

Google's first-quarter earnings report, scheduled for Thursday afternoon, just got a lot more interesting.

Late Tuesday night, those Internet traffic trackers at ComScore put out some lousy news: growth in paid-search clicks in the United States is slowing down.

In fairness to Google, it did better than its competitors, according to a JPMorgan report issued Wednesday morning. (ComScore's paid-click numbers are not typically issued directly to public. We hear about them when Wall Street analysts issue their own reports on the data.)

Paid-search clicks at Google were up 2.7 percent in March, compared to the same month a year ago. That means that growth for the full quarter was just 1.8 percent year over year, a rapid drop from 25 percent year-over-year growth in the fourth quarter. (Henry Blodget at Silicon Alley Insider has a good take on the worst-case scenario for Google's first quarter.)

But competitors did worse. Yahoo paid clicks declined 3.1 percent year over year in March (all percentages are year-over-year comparisons), though for the quarter, paid clicks at Yahoo grew 5.4 percent, also marking a drop-off from the fourth quarter's 9.8 percent growth.

At Microsoft's MSN, the news was flat-out bad. Paid clicks in March dropped 15.1 percent. For the quarter, paid clicks declined 12.3 percent. At AOL, March paid clicks dropped 2.3 percent. For the quarter, paid clicks declined 5.8 percent--a noticeable turnaround from the 29.3 percent drop in the fourth quarter.

In total, the market wasn't healthy. In March, it declined 1.5 percent. For the quarter, it managed 0.3 percent growth, versus a 15.8 percent increase in the fourth quarter.

What remains to be seen, of course, is whether the ComScore results have any correlation to Google's financial results. Similarly disappointing news earlier this year led to a significant drop in Google's share price. In fact, since November, Google shares have dropped about 40 percent since hitting $747.24.

So far, there's certainly no panicking because of the ComScore numbers. Google was up about 2 percent to $456.20 in midday trading Wednesday.

Analysts and Google pundits are split on what the ComScore numbers mean. Google maintains that its deceleration has more to do with its efforts to improve the quality of its ad leads (which should drive up average selling prices) than a broader economic slowdown. But disappointing numbers at all the major search sites may indicate that there's a broader economic explanation than Google's improved quality control. Is the paid-search advertising business as immune to a sour community as Google executives like to believe? We'll find out tomorrow.

Google, of course, is one of those big tech companies people closely follow in order to get a read on the health of the high-tech industry. We watch Google's results more closely than any other Internet company for good reason: because of its dominant search market share, Google is a good indicator of the health of Internet advertising. A slowdown at Google can be a sign of big trouble ahead for smaller companies.

On Tuesday afternoon, Intel executives signaled confidence in the coming year. IBM, another one of those tech bellwethers, reports its first-quarter earnings after the stock market closes this afternoon.

So by the end of this week, we'll have a better sense of whether it's time for tech companies to batten down the hatches.

Google gained market share in the United States over search rivals in March, rising 0.53 percentage points to an all-time high of 59.8 percent, according to new ComScore results released Tuesday.

"We were somewhat surprised at the March uptick, especially since the company had previously alluded that the unusual Easter timing could impact search activity," said Citigroup analyst Mark Mahaney in a report Tuesday that quoted the ComScore numbers.

Yahoo, meanwhile, slipped 0.3 percentage points to 21.3 percent, and Microsoft dropped 0.2 percentage points to 9.4 percent--both figures are record lows for the companies, Mahaney said.

Lower in the rankings, AOL dropped 0.1 percentage points to 4.8 percent, while Ask.com rose 0.1 percentage points to 4.7 percent for March, according to the report.

The number of searches increased 18 percent compared to March 2007. Google's tally rose 18.4 percent, Yahoo dropped 1.8 percent, and Microsoft increased 9.4 percent.

Sports fans boosted ESPN's status in ComScore's latest measurements of Web site traffic, but the top sites kept their rankings unchanged during March.

ESPN jumped from 46th place with 17.8 million page views from U.S. visitors in February to 34th place with 22.4 million page views in March, the month of the March Madness college basketball tournament and the Major League Baseball season opening, ComScore said.

Sports-related online gambling sites also saw a surge, with Sportingbet's visitor tally jumping 35 percent to 975,000, ComScore said. Upickem.net and SportsBetting.com, while smaller, also saw major gains.

The biggest players, however, were unruffled by these blips, with the top 10 unchanged in their relative rankings.

Yahoo kept the top spot with 140 million page views. Next were Google, with 138 million page views; Microsoft, with 121 million; AOL, with 111 million; and Fox Interactive, with 88 million.

ComScore makes its estimates of Web site visitors and page views based on the surfing behavior of about 2 million people at home, work, and college, with statistical extrapolations to gauge total traffic.

The methodology, though, hasn't sat well with Web site operators such as MySpace who say traffic is much higher and with the Interactive Advertising Bureau, which last year asked ComScore and its rival, Nielsen/NetRatings, to submit their data to audits. (CNET Networks, which is News.com's parent company, is among the IAB board members that approved the audit request.)

After ComScore reported a recent decline in Google's paid clicks, the Net ratings service followed up, noting evidence that the drop was due to "Google's own quality initiatives that result in a reduction in the number of paid listings and, therefore, the opportunity for paid clicks to occur."

The reduction in listings, ComScore noted, was "offset by paid revenue per click."

On Monday, at a Bear Stearns media conference in Palm Beach, Fla., Tim Armstrong, Google's president of advertising and commerce in North America, offered essentially the same view on the matter.

As noted by ZDNet Editor in Chief Larry Dignan, Armstrong emphasized that the dip in paid clicks was intentional--part of a strategic plan designed to deliver better, more-precisely targeted ads. Thus, the market anxiety that hit Google's stock was, well, unjustified.

OK then, but Dignan also cites Armstrong's acknowledgment that "search is changing overall in general" and tends to reflect macroeconomic conditions--an acknowledgment, Dignan points out, that suggests Google isn't recession-proof.

Google also told conference attendees that it won't be developing its own content, that it will increase the number of videos and ads on YouTube, and that the company's system won't differentiate between search and display ads over time.

Google's general theme is to offer advertisers a complete dashboard with multiple forms of advertising. Armstrong also noted that Google will deliver ads on social networks via widgets and social-networking apps.

We interrupt this scheduled lashing of Yahoo to ask a question about the company that's been putting a whuppin' on Jerry Yang & Co. over the last few years: Are you OK?

Google shares dropped 4.57 percent Tuesday largely on new ComScore numbers that show flat year-over-year growth in U.S. paid-click performance in January. It's an abrupt turn from the 25 percent year-over-year growth Google produced in the fourth quarter and the consistent growth Google has shown since, well, since there's been a Google. Regardless of what you think of ComScore's oft-controversial methods, this isn't good. As Henry Blodget aptly put it in Silicon Alley Insider, "Even if ComScore is only half right, this is a disaster."

Google declined to comment on the report.

Today's nearly 5 percent drop brings the search king's share price down from its 52-week high of $747.24 in November all the way to $464.19 at the end of trading Tuesday.That's just one more tidbit of bad news from Google's 52-week low, $437 per share, back in March 2007.

Google, it would seem, can't defy gravity or a bad economy more than any other company. For some, the ComScore numbers offer a fine opportunity to gloat. Others, and bless the optimists, aren't terribly worried just yet. But for most companies relying on advertising for their revenues (and who doesn't these days?), Google's bad news provides plenty of reason to fret.

Sure, it could be that Google's dominance of the ad market is waning. That would certainly be the glass-is-half-full scenario. But the more likely scenario is that Google is a bellwether for the rest of the online ad market, that everyone will struggle as the economy heads south, and that we're on the cusp of plenty more bad news.

But then I covered the first dot-com bust. I always think the glass is half empty.

StopBadware.org said Tuesday it has labeled the Sears and Kmart community software known as My SHC Community as "badware," or spyware.

The nonprofit organization run by Harvard Law School, Oxford University, and Consumer Reports WebWatch said it cited the Sears Holding Corporation community in particular "because of inadequate disclosure of extensive tracking and data collection and because the application does not identify itself while running."

In response to several accusations that it collects personal information without proper disclosure, My SHC Community has dramatically revised its Web site since last week. It has, among other changes, added a prominent link to its privacy policy.

At issue is the installation of tracking software from ComScore, an online data marketing firm. ComScore has maintained over the years that its data collection methods do not qualify as spyware. However, several leading antispyware researchers disagree.

In a statement (PDF), StopBadware.org said: "Sears Holding Corporation (SHC) has informed StopBadware that SHC is significantly improving the My SHC Community application disclosure and privacy policy language and adding a Start menu icon in an effort to comply with our guidelines and address privacy concerns. They expect these changes to be implemented within 48 hours."

However, late Tuesday, StopBadware.org said it has not changed its designation of SHC Community. "We have not evaluated these planned changes at this time. SHC has also informed us that they have suspended invitations to new users to install the application until these changes are implemented."