Hit by pandemic-related cuts in ad spend, Googles digital media revenues fell by 7 per cent in Q2 2020 to $38.3 billion, causing its market share to fall from 29 per cent in Q1 2020 to 26.3 per cent in Q2 -- its lowest share of the global digital media market in the past six years.

According to a report by market research firm Strategy Analytics, the major factor was the decline in travel and leisure advertising, in which Google is particularly strong, as a result of behavioral changes brought about by the Covid-19 pandemic.

Facebook remained the world's number two player, with a 12.8 per cent share in Q2, while Apple remained in third place, in spite of a decline in market share to 9 per cent. Alibaba, the world's fourth largest digital media company, was helped by a resurgent Chinese economy and saw its share rise to 8.4 per cent in Q2.

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Google had earlier tried to explore the wearable devices market but hasn't tasted much success Pixabay

The overall global digital media revenues saw modest quarterly growth of 2.8 per cent in Q2 2020, as the global economy slowly began to recover from the initial impact of the Covid-19 pandemic, and Q2 revenues of $145.7 billion were also nearly 12 per cent higher than a year earlier.

"China's recovery in Q2 is an indication that western firms like Google should hope for a similar bounce during the rest of 2020, but there is clearly still a great deal of uncertainty," said Michael Goodman, Director, TV & Media Strategies and the author of the report.

Hope for Recovery

"Firms focusing on entertainment sectors such as video and games have tended to demonstrate superior revenue growth more recently and there is good reason to expect this trend to continue through the rest of the year," he added.

The strongest digital media sector was online games, where Q2 revenues increased by 12.9 per cent over Q1. Digital music revenues fell by 11.4 per cent as time spent listening to streaming music declined in Q2. Online video revenues rose by 2.8 per cent and digital advertising revenues were more or less flat, the report said.