Well, this ought to catch some folks attention, written by the fellow who called Amazon $400:
I’m just laying out a scenario that could kneecap Google and take its stock back to, say, $100 a share.
Google’s major weakness is that it is almost entirely dependent on one, high-margin revenue stream. The company has dozens of cool products, but with the exception of AdWords, none of them generate meaningful revenue. From an intermediate-term financial perspective, therefore, they are irrelevant.
So, the question is, what could happen to AdWords, and what will happen to the company (and stock) if it does?…
… let’s say click fraud continues to increase as a percent of total clicks (which seems perfectly plausible to me). Eventually, all else being equal, ROIs will start to decrease, as the $1.00 keyword that delivers a profitable sale today will deliver an unprofitable one tomorrow.