Google Owner Larry Page Speaks With Forked Tongue
Posted on May 22, 2008 in the Investing category
.I had to laugh when I read Google founder Larry Page’s comments about a potential Microsoft takeover of Yahoo, saying it would concentrate too much power in the online communications market, stifling innovation and curbing competition.
But he discounted the idea that an advertising deal between Google Inc. and Yahoo Inc.—one the two companies are now exploring—would present any potential antitrust problems.
Page said a successful Microsoft-Yahoo deal would “close a lot of things that are really important … like instant messaging” and also Web-based e-mail communications.
“Now, if you put 90 percent of communications all in one company … that’s really a big risk, especially one (Microsoft) that has a history of doing bad stuff,” he said. “So if you want to have good products you need to have some degree of openness.”
However, ComScore Inc. earlier this year provided data that showed a combined Microsoft-Yahoo company would have about a 70 percent e-mail and instant messaging market share in the United States and a 77 percent market share worldwide. ComScore figures were from December.
If I remember my ComScore numbers, I think that Google has an over 62% market share of the U.S. search market. Google’s adwords page for new advertisers boasts that if you advertise on Google you will reach 76% of all U.S. internet surfers, and 75% worldwide.
Doesn’t Google’s growing search market share threaten openness Larry?
I am not crazy about Google as a stock. What concerns me is that they have only been able to deliver one product, a highly profitable product at that mind you. Any slowdown in the world economy and companies will start to reduce their advertising budgets., If they do, they Google’s revenues will shrink.
Also, while Google will tell you that big advertisers will move their advertising money frm old media (TV, print and radio), the bottom line is that Google could not handle those kinds of budgets. I spoke to a company last year who where looking to increase their paid budget by over $10 million a year. The problem was that they could not find enough traffic to buy.
And that is a common challenge that Google faces. How to get clients with multi million dollar a month budgets enough traffic so that they can spend all that money
.
Comments
Leave a Comment