Google posts record quarterly profit

LOS ANGELES: Google Inc. shifted into a higher gear inthe third quarter and began to leave the recession behind as the11-year-old Internet search leader recorded its biggest profit yet.

Revenue growth also accelerated for the first time since the U.S.recession began in December 2007.

The results released Thursday are the strongest indication yet that the Internet advertising market is bouncing back from its worstfunk since the dot-com bust at the start of the decade.

Google is considered a good barometer for the state of online commerce because its search engine serves as the hub of the Web's largest advertising network.

``The worst of the recession is clearly behind us and because of what we have seen, we now have the confidence to be optimistic about our future,'' Eric Schmidt, Google's chief executive, told analysts in a conference call.

Schmidt's optimism echoed his public remarks leading up to the earnings release. That sentiment has helped propel Google to a succession of new 52-week highs this week, a rally that continued after the company put out its third-quarter numbers.

Google's shares rose $17.13, or 3.2 percent, to $547.04 in extended trading. In regular trading earlier, its shares fell $5.41,or 1 percent, to close at $529.91. The stock remains well below its peak of nearly $750 reached almost two years ago, but has more than doubled from its 52-week low of $247.30.

Google earned $1.64 billion, or $5.13 per share, in the three months ended in September. That represented a 27 percent increase from $1.29 billion, or $4.06 per share, at the same time last year.

Excluding expenses for employee stock compensation, Google said it would have made $5.89 per share _ above the average estimate of$5.42 per share among analysts polled by Thomson Reuters.

Revenue for the three months ending in September climbed 7percent to $5.94 billion. That is Google's fastest growth rate so far this year.

In a telling sign that things are picking up again, Google's third-quarter revenue rose 8 percent from the second quarter. That's the biggest sequential quarterly increase since the end of 2007.

After subtracting commissions paid to Google's advertising partners, the company's revenue totaled $4.38 billion _ about $140million above analyst estimates.

Schmidt and other Google executives left no doubt that they believe the Mountain View-based company is poised to scale even greater financial heights in the next year or two.

Among other things, they said the company's popular video service, YouTube, is getting closer to making money three years after Google bought it for $1.76 billion.

Feeling more emboldened, Schmidt said Google will start spending more liberally again after skimping on its expenses for the past year. The commitment includes hiring more employees after Google pruned its payroll for the past two quarters, paring its work force to 19,665 people at the end of September.

Google could be further along the comeback trail than other companies that depend on Internet advertising.

Part of the reason is because Google is such a dominant force; it process nearly two-thirds of the Internet search requests in the U.S. Advertisers are more likely to invest in search marketing because it only costs them when Web surfers click on their commercial messages.

Spending on online billboards _ the kind of visual advertising that's Yahoo Inc.'s specialty _ isn't expected to pick up until the economy gets even healthier.

Yahoo is scheduled to report its third-quarter earnings next week.

UN rights body endorses Gaza war crimes report

GENEVA:  The U.N. Human Rights Council on Friday endorsed a Gaza report that accused both Israel and the Palestinian militant group Hamas of committing war crimes in their December-January conflict.

In a special session, 25 of the body's members voted in favour of the resolution that chastised Israel for failing to cooperate with the U.N. mission led by South African jurist Richard Goldstone. Another 6 voted it against and 11 abstained.

Both Israel and Hamas have rejected the charges in the Goldstone report, which is most critical of the Jewish state. The report calls for the U.N. Security Council to refer the matter to the International Criminal Court if the Israelis or Palestinians fail to investigate the alleged abuses themselves.

Palestinian reaction

Palestinians welcomed the U.N. endorsement of the report.

"The Palestinian Authority welcomes the decision of the U.N. Human Rights Council and we hope this will be followed up in the U.N. Security Council to ensure such Israeli crimes are not repeated," chief Palestinian negotiator Saeb Erakat told AFP.

Israel had no immediate reaction to the vote.

In Gaza, Hamas also approved the move, thanking the nations that voted to endorse the report.

"We hope that vote will lead to a trial of the occupation leaders," said Hamas spokesman Taher al-Nunu.

In the report circulated last month, the investigators led by South African jurist Richard Goldstone accused both Israel and the Palestinian group Hamas of war crimes in Gaza, but were overall more critical of Israel than Hamas.

Israel has rejected the charges in the report. It however came under pressure in a U.N. Security Council debate on Wednesday to fully investigate its allegations. 

Israel's ambassador to the U.N. in Geneva, Aharon Leshno Yaar, said Thursday the Human Rights Council resolution -- drafted by the Palestinians with Egypt, Nigeria, Pakistan and Tunisia, on behalf of non-aligned, African, Islamic and Arab nations--threatened to "set back hopes for peace."

"They will clearly hear that this new form of warfare, as used by Hamas in Gaza, will offer immunity as countries will be prevented from waging effective responses," Yaar said.

Pressure on Netanyahu

The text calls for the U.N. General Assembly to consider the Goldstone report and for U.N. Secretary-General Ban Ki-moon to review Israel's adherence to it. That would keep up pressure on Israeli Prime Minister Benjamin Netanyahu who Washington is trying to convince to commit to a "two-state solution" that previous Israeli governments have signed up to

Netanyahu has urged the U.N. Human Rights Council to reject the report on Friday "Responsible nations have to vote against this decision that supports terror and harms peace," Netanyahu told reporters late on Thursday after a meeting with visiting Spanish Prime Minister Jose Luis Rodriguez Zapatero.

The draft resolution debated by the council seeks endorsement of "the recommendations contained in the report ... and calls upon all concerned parties including United Nations bodies, to ensure their implementation."

The Goldstone report recommends referral of its conclusions to the International Criminal Court prosecutor in The Hague, if Israel and Hamas fail to conduct credible investigations within six months.

Italians bribed Taliban to avert attacks

KABUL: A Taliban commander and two senior Afghan officials confirmed that Italian forces paid protection money to prevent attacks on their troops.

After furious denials in Rome of a British paper report that the Italian authorities had paid the bribes, the Afghans gave further details of the practice. Mohammed Ishmayel, a Taliban commander, said that a deal was struck last year so that Italian forces in the Salobi area, east of Kabul, were not attacked by local insurgents.

The payment of protection money was revealed after the death of ten French soldiers in August 2008 at the hands of large Taliban force in Sarobi. French forces had taken over the district from Italian troops, but were unaware of secret Italian payments to local commanders to stop attacks on their forces and consequently misjudged local threat levels.