LookSmart is a global Internet search infrastructure company. LookSmart creates highly targeted online marketing products for its customers by matching the users' need for relevant search results with the onlinemarketer's need for effective targeting. LookSmart creates a range ofdirectory listings and search targeted advertising products that aredistributed through its search infrastructure platform through leadingInternet portals ISPs and media companies. Looksmart Ltd. has a market cap of $21.2 million; its shares were traded at around $1.24 with and P/S ratio of 0.3.
Highlight of Business Operations:In the second quarter of 2009, purchased technology of $0.3 million was impaired by approximately $0.2 million because an associated initiative was discontinued. Any adjustment to the estimated impairment based on additional information providing a more accurate measurement will be recognized in subsequent reporting periods.
One of these two customers, IAC Search and Media (IAC), notified us in May 2009 that it does not intend to renew the May 2005 AdCenter License, Hosting and Support Agreement, which provides for certain Publisher Solutions services when it expires on December 31, 2009. The decrease in Publisher Solutions revenue from IAC has accelerated since the May 2009 notification from $1.4 million and $4.0 million, respectively, for the three and nine months ended September 30, 2008, to $0.6 million and $2.6 million, respectively, for the three and nine months ended September 30, 2009. Advertiser Network revenue derived from IAC, which is covered under separate distribution agreements, was $1.3 million and $4.1 million, respectively, for the three and nine months ended September 30, 2009, and $1.5 million and $3.3 million for the three and nine months ended September 30, 2008. IAC has not indicated to us an intent to terminate these separate distribution agreements.
We recognized Advertiser Networks revenue of $11.8 million and $35.8 million, respectively, during the three and nine months ended September 30, 2009, down 15% and 21%, respectively, from the $13.9 million and $45.4 million, respectively, recognized during the three and nine months ended September 30, 2008. Revenue from Advertiser Networks decreased in the third quarter of 2009 by $2.1 million and $9.6 million in the first nine months of 2009 compared to the same respective periods in 2008.
The Advertiser Network saw growth in total paid clicks for both the three and the nine months ended September 30, 2009. Total paid clicks for the three months ending September 30, 2009 increased 19% to 219 million, compared to 184 million for the third quarter of 2008. During the same period, average RPC decreased from $0.076 to $0.054 compared to the previous years quarter. Paid clicks totaled 610 million for the nine months ended September 30, 2009, compared to 531 million for the same period of 2008. The 15% increase in paid clicks was offset by a decrease in revenue per click from $0.086 to $0.059 over the same time period.
We recognized Publisher Solutions revenue of $0.7 million during the three months ended September 30, 2009, a 51% decrease from the $1.5 million recognized during the three months ended September 30, 2008. IAC represented $0.6 million, or 74%, of Publisher Solutions revenue during the three months ended September 30, 2009. For the nine months ended September 30, 2009, we recognized $3.2 million of Publisher Solutions revenue, a decrease of 31%, or approximately $1.4 million, from the $4.6 million recognized in the same period of the prior year. IAC represented $2.6 million, or 82%, of Publisher Solutions revenue for the nine months ended September 30, 2009. The decrease in Publisher Solutions revenue for the three and nine months ended September 30, 2009 as compared to the same periods in 2008 is attributed to reduced revenue from IAC, a portion of which relates to a contractual reduction of the revenue share percentage in the final year of the contract.
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