• , Wednesday, February 27, 2008 11:46 AM

Google's stock plunged 5 percent yesterday following comScore's report that paid clicks in January were flat year-over-year, an alarming drop-off when you consider that paid clicks were up 37 percent in October. The comScore data is a stark reminder that search is not immune to a recession. Instead, comScore says Yahoo posted a 15 percent year-over-year increase in paid clicks.

Meanwhile, Hitwise General Manager Bill Tancer says that in a recession, search engines would be sending less traffic to retail sites, but according to Hitwise data, the percentage of traffic sent to retail sites from Google has been increasing steadily over the last three years. There's always a steep drop off in January, with retail spending ramping up as the year moves along.

A more likely explanation is that Google is stepping up efforts to combat click fraud in order to generate higher quality clicks for advertisers. comScore's click-through estimates and Google's actual revenues have been far apart in the past.

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