Google’s New World Order

No doubt about it, Google has Gates-like ambitions. Bill Gates told Fortune magazine in a discussion about Google, …"they are more like us than anyone else we have ever competed with." Clearly, Google is the biggest threat to Microsoft dominance that Microsoft has ever seen.

Amazingly, after less than a year of going public Google is already valued by stockholders at almost one quarter of Microsoft. That is astonishing considering Microsoft’s profits of $8.2 billion last year made it the 12th most profitable among the Fortune 500, just behind IBM. Microsoft is the second most valuable company in the world with a market cap of $293 billion. Google’s $80 billion cap puts it in a battle to become the most valuable media company. That is just under Time Warner’s market capitalization of $82 billion.

All of this from selling key word searches? Not exactly. Yes, all of Google’s revenue and profits are coming from key word searches, but its stock price is reflective of huge growth projections that will come from a variety of business initiatives … some of which will strike at the heart of Microsoft itself.

And Microsot is worried as Robert Cringley writing for PBS explains, “That pace of technical development, which probably isn't sustainable for long at any company, isn't POSSIBLE at all at more mature companies like AOL, Yahoo, and especially Microsoft. That adolescent energy is the mojo that makes a startup scarier to Bill Gates than a mature competitor. He knows that if Microsoft ever takes a big dive, it will be because of a Google, not a Yahoo, and certainly not an AOL.”

So what is Google up to that concerns Microsoft? The answer is Google Internet. Using its power position on the Internet Google is winning users by providing them simpler alternatives. Google is beating Microsoft in the battle of the Internet. And as Bill Gates stated a decade ago in his forward thinking book, The Road Ahead, “We stand at the brink of another revolution.” Unfortunately for Microsoft, it is Google that is the driving force.

Google Search is still light years ahead in terms of result quality and leads all rivals. (Just my opinion ... please give me yours)

Google Talk will become the leader in consumer and small business messaging. It will also make voice communication over the Internet mainstream. Most of us don’t do it now … but thanks to Google we will soon.

Google Desktop has already become the leading desktop search app because it works. Searching for files with Explorer that comes with Windows is cumbersome and can take forever.

Google News is one of the leading news sites in World because they did news aggregation better than anyone else. Definitely better than the first news aggregation site on the Web, NewsLinx, which I founded in 1996.

Gmail beats Microsoft’s HotMail and Yahoo Mail hands down. It’s better at spam filtering and the ads are much more palatable.

Yes, the battle is still young and Microsoft is working to compete. But it seems that Google knows how to win and is slowly knocking off the competition for the hearts and minds of Internet users.

It appears that If Google makes it they will come. One can certainly understand why Microsoft is worried about what Google is up to. Could a Google distributed operating system be next on the list? What do you think? Please give us your thoughts.

We also have an in-depth article today on the “Google Revolution” by iEntry writer Jason Miller.

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Rich Ord
CEO, iEntry, Inc.
http://www.ientry.com

Google is a young company, and have young people with open minds.

http://www.useit.com/alertbox/basscurves.html

As Google mature this comparative advantage will (most probably) decrease.

It has been talked about the net computer. Your computer is more like a terminal that is used to submit commands and collect results. Numbercruncing and processor intensive tasks take place on the net. Like this http://www.w3schools.com/ free Ad driven site, netcomputing is Ad driven. If that happens and a "net operating system" becomes an integral part, the internet may be lifted to a new level. Obvious advantages for people in developing countries with low bandwith and computing capacity. If that happens, we get true client / server (ditributed) computing / processing.

Related link:
http://www.blogger.com/start

Easy for everybody to have their own site, and by buying a domain name and using cloacking
http://www.blognorway.com/

you get a unique site ont the net for about USD 10.

Kjell Gunnar Bleivik
http://multifinanceit.com/
http://www.blognorway.com/
http://www.multifinansit.no/

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Mini Network:: Financial information at your fingertips
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"Google Search is still light years ahead in terms of result quality and leads all rivals. "

Whatever... I remeber using webcrawler to get away from AOLs sucky paid for search responses... Now I jump to page 5 on google just to get to some real websearch leads.

I use google when yahoo or msn or anything else doesnt show me what im looking for... the best thing google has is the google image search and I use that a lot, but to say they are light years ahead of the its rivals is a stretch, I have problem after problem with google and its jumbled "priority" system.. it fruequently makes mistakes and generates its responses based on one thing... MONEY - thats what make gates sit up and listen, but for everyday use it sucks

Well Google Browser is next in line, either it will be a success or a failure, but more chances favour google because of its large collection of customer oriented services which are FREE, and we all like FREE stuff, don't we, so they will be integrating more of thier services with the passport concept of microsoft.

Not overlooking that Google can buy the best minds in the business, I am looking forward for the news of a Google Operating System to rival Windows.

Next thing you know Google will be sending someone or something to the moon.

"Google Search is still light years ahead in terms of result quality and leads all rivals."

I disagree wholeheartedly on on this statement. Google's results are based on who has the most links and most frequently returns results that are barely related to what you're searching for. I've found that MSN search consistently returns the most related sites since they rate page content so highly.

Hi
My name is Maja and I’m pretty new in all of this but in my short experience (5 years) I thigh that goggle and all other search engines working first whit site that pay ranking than whit site that have most links and lot of other sites link to them. Stupid because one adult site kind not have much friends like one blog or wine site. That comes all your metatags.
http://www.croatianvideo.com

Looks like yet another person has been brainwashed by one of the most hyped companies in Internet history.

A list of things Google IS:

1. They are a good search engine (there is no great one)
2. They have good market share in search (but has declined consistently over the last 5 years)
3. They have acquired significant capital (that they seem to be spending like water)
4. They have huge plans, almost none of which has to do with their core competency.
5. They have PPC and Contextual Search

That said, they are not in the top 2 sites in the world and never have been. (YAHOO and MSN have been #1 and #2 every day for 5 straight years)

They are also not a portal though they do put on a good show.

Market cap value is NOT cash on hand. Virtually their entire net worth has come from speculation.

I have to hand it to them, as arrogant as they are they have the best PR team I've ever seen. They have convinced the world that they are the second coming of the Internet boom.

Since the dotcom crash people have been waiting for things to turn around. Most people are sheep and optimists when it comes to technology investing. They remember all of the people who made fortunes "the first time around" and they didn't want to miss the boat if Google somehow launched an industry-wide comeback. Google used this social mindset to its advantage and purposely waited to release their IPO right before the holiday season so when they reported their first quarter earnings it would appear that they were on this rocketing growth rate.

People also forget that Google has been giving out stock for years. And most of the options vested in Q2, so everyone at Google was working as hard as they could to drive the stock up so they could finally cash in.

Google is as inflated as the housing market (but let's not get me going down that road or the debt to asset ratio rising to record levels).

They have basically 1 major source of revenue and they had few competitors. That is about to change with MSN and Yahoo both launching into the Contextual and PPC Marketplace (Yahoo already owning Overture).

They have done a few things right. Google Maps is a pretty awesome system (though they can't take credit for actually creating it because they just purchased the company who did).

Geo targeting has been all the rage but there are MANY roadblocks when it comes to delivering relevant results. The idea (eventually) is that someone can drive down the street, type in a search on their cell phone or PDA and get a list of results in the area. Really it is a system of localized, on-demand advertising.

1. What if a company serves more than one area?
2. Is it only open for PPC accounts or is Google REALLY interested in delivering relevant naturalized listings?
3. What if a company, like a liquor store, doesn't have a website? Will they mix phone numbers and addresses with website listings? If there ARE website listing, what good does that really do you when you are driving down the street? If there ARE NO website listings then is this whole thing really just a hyped up Yellow Pages?
4. What if a company is a service provider and can really offer their services anywhere? Are they left out in the cold? If so, are you going to get people lying about where they are located?
5. Consequently, how do you protect against a company who optimizes for places that they aren't even in?
6. What if it is a non-geo-related search. Like the "history of bottled water". What results would come back and can they determine if someone is searching at home on a computer, or via a cell phone on the road? Meaning, is this an enhancement to their regular search listings or is it a completely independant system?
7. What if someone is searching for "Cars" on their search engine. How does Google know if they are looking for research on cars, looking to buy a car, want an auto repair shop, looking for an auto show event, etc? Or how do they know if the user even cares to look for cars in their area?

Ultimately Google (and every other search engine for that matter) can not predict INTENT. Sure, they try. They will try to build a history of your searches and somehow customize the results to what they THINK you want. Without user interaction that can NEVER work.

If I searched for "plasma TV" on one search it doesn't mean I want information on plasma TVs on the next. And how do you even know it is me if I have never logged in or registered? A cookie? IP tracking? What if multiple people used the same computer in the same house, or I logged in on a different computer such as a public library, will my search results be different? Do you think every person would use Google search if they had to register to do so? Not a chance.

The problem with Google is that they are still on this altruistic crusade that the Internet is a democratic marketplace. Their goal has always been to provide relevant results but it is still based on the underlying philosophy they had at Stanford, Page Rank. Even if it isn't "Page Rank" in its original form they still use a hubs and authority weighting formula that they think can't be manipulated. Whether it is the "Hilltop" strategy or not is meaningless. It is still a formula. Back at Stanford in their original thesis, they stated that Page Rank COULD be manipulated but then they came to the conclusion that it wouldn't be economically viable for someone to do so. They never anticipated that Search or the Internet in general would reach the levels it has and that there would be so much money in it.

Ok, so everyone knows they may be checking for multiple domains, and reciprocal linking, and duplicate content, and IP addresses, and bad search neighborhoods... blah blah blah. They can keep trying all they want but they can't stop someone from manipulating it.

How about 5000+ domains, registered on different days/years (and for multiple years) behind proxy services (and even different entities), with non-reciprocal linking strategies, on different IPs, in different datacenters, on different A BLOCKS (I'm not just talking about C blocks), all completely optimized through a central database with a keyword list of 100 million, that also generates pages on steady structured (yet randomized) intervals from millions of stored news articles and other fresh content, with every page automatically placed into different Google Sitemap accounts as well as being Pinged on 100+ different sites across the internet, each site with its own RSS feed, each with a different dynamically created non-footprintable template (with even dynamically created CSS style names, directories, image names, file names, and layout code)...

I can go on, but you get the point. Don't think this can't be done... it is already being done. Google's biggest strength is also their biggest weakness... their algorithm.

Because they have eliminated the human element, and because the results are based on a formula, that formula will ALWAYS be open for manipulation. Of course the scenario I mentioned above would even pass a human review. A site would never link to another site that linked to it, nor would it ever look the same or have the same content, nor would it be registered by the same entity or the same day or have the same IP address.

But the public doesn't know any of this. It wasn't users who made Google popular. It was webmasters and the companies advertising on Google that built the company... really kind of a symbiotic relationship starting in the early-mid 90s.

Google naturally came to the conclusion that they couldn't just rely on Internet Search. So they came out with desktop search. A good idea but it is 10 years behind compared to Yahoo who has been working on theirs for nearly a decade. And Microsoft's Longhorn will subplant both of them. When you own the OS, you bypass everything else.

Then Google figures they will come out with GMAIL because they wanted to cut into MSN and Yahoo's market share in the free email market. They decided to launch and unprecedented 1 GB of storage (as if anyone would ever use it). It took 1 week and Yahoo increased theirs as well. So much for that idea Though it isn't for a lack of effort on Google's part.

GMAIL is not as good as you think it is and even if it was, it is irrelevant. It doesn't matter if you are the best. It only matters if you can sell it.

You can go back to the battle between Jobs and Gates to learn that lesson being the Xerox actually created the first PC. Jobs took it from Xerox, then Gates took it from Jobs and got it to market before him (even knowning it wasn't as good). It doesn't matter. People aren't going to just drop their Yahoo and Hotmail accounts that they've had for years.

GMAIL is an afterthought. It doesn't even make the top 20 email providers. It doesn't have 5% of the members that Yahoo and MSN do. So, let's move on.

The reality is that Google has grown this market cap out of great PR and a "promise" of continual growth. The American public is gullible. The public doesn't want to look at details. They want to read bullet points and headlines. All they see is "Google is doing this and they are launching that. Wow, they are on a roll, let's jump on and ride this to the top."

It's just smoke which is what caused the first Internet bubble.

Why is it that people think companies can just continue to grow and grow forever (especially at the rate Google claims)? It is economically impossible.

Google will not disappear tomorrow but they are fighting a battle they really can't win. My next question is why does everyone think there has to be a winner?

Just because they can't take down MSN or Yahoo doesn't mean they have to. If Google and the rest of the world would come back down to reality, they may actually build a solid profitable company that is sustainable long term rather than burning through cash on this epic quest to be "the next Microsoft". Listen, you can't "out Microsoft", Microsoft. Gates and Balmer are not worried at all. All Google did was awaken a giant which is the last think Google should have done. As much cash as people think Google has, they STILL can't out spend Microsoft dollar for dollar, nor can they out market them either.

MSN is a full-fledged media company with ties to NBC, FoxSports, and is one of the largest ISPs in the world. They have embedded marketing channels for their services. Yahoo is the same way with tens of millions of REGISTERED users online.

I actually like Google's search. Though it isn't perfect it is generally a little better than MSN and Yahoo is just flat-out horrible. But though I'm not pro-Microsoft, I am a realist and it baffles me why people think Google is anything more than a search engine at this point.

I personally think they should stick to what they are good at and what got them to where they are in the first place. They need to evolve their search algorithm rather than just constantly thinking of ways to "nickel and dime" their advertisers so they can hit their numbers.

But... if they ARE going to stay on this philosophy of "take down MSN or die trying", here is some advice. I hope someone is listening.

4 main things Google must address:

1. You need to come out with chat software and it has to be good. Yahoo, MSN, and AOL have their own and if you are going to play with the big boys, you better build it. It creates a marketing channel and is the first step to getting into the OS. If they do launch a browser, keep this one thing in mind. The web community doesn't need another F**ked up browser to design around. So make sure the darn thing is compliant. I would suggest either purchasing or adapting Firefox which is the fastest growing browser. One of the orignal developers of Firefox actually has been hired by Google.
   
2. You need to launch additional services such as online games and chat rooms. This is really what helped build Yahoo to where it is today. It is what keeps people coming back. MSN and AOL also have them.
   
3. You need to make sure that your Advertising services are more business centric. THEY MUST find a way to combat click fraud. They even brought this up at their recent shareholders meeting.
   
4. The search philosophy needs to be seriously reworked. Yes they are the best now, but adding on to an old frame can only take you so far. Take it for what it is... it helped you build your brand and worked well in the infancy stages on the Internet but it is not a long term solution. If the true goal is relevancy then you can't just anticipate what you "think" the customer is looking for. You also can not assume that every site on the internet is independent to every other site on the Internet. They have just been applying Band-Aids and fixes to their algorithm for the past 5 years. Eventually they will need to think of a new approach if they want to continue to lead the search industry.

Ok, enough of my diatribe. I mean no offense to the original author of this thread but as I read the post, it sounded like more blindly optimistic hype. How about some reality for once.... no seriously.

I believe that Rich and Guru both have valid points.

Let's face it, the kids dig Yahoo for many reasons, and they will for some time to come. MSN is all business, and very good at what they do. My impression of Google is still that of an amped up search engine.

However, it should be noted that Rich's statement about the energy that Google possesses not be overlooked. If the Internet were a Serengeti, then Google is no doubt a young lion that walks almost anywhere it pleases. MSN and Yahoo are huge strong beasts that sit comfortably in the shade of their own trees, and perhaps find it annoying that they're being watched from afar by this young intruder, but can any animal really remove them? Many seasons would have to pass for that to happen.

I am with SEOGuru on this one. I think Rich's article is overly optimistic for Google. Nobody can deny the way they changed Internet Search but I think most of the points of the Guru about the realistic look to Google is true.

I think there is a lot Google needs to prove in order to talk about potential to grow even more. Even in the search quality area I don't agree with Rich's comment about being light-years ahead of MSN, Yahoo. I think Google is (or should be) in a defensive mode then aggresive one right now since it will possibly be a ride down from here if they can not manage to monetarize other revenue sources and / or keep their market share at the same time.

I find the sites that rank well on Google are also the sites that pay for placement on other sites. Sometimes Google is good, but most of the time its the sites that pay who get the most hits and that seems to be Googles Number 1 criteria.

All in all I'd say its just too early to tell.

__________________
Community College Planner

I would disagree that Google has the best results on search engines - If you want the most results yeah sure. but who needs 20,000,000 results when searching for something that can be found with less results?

I for one don't trawl through every single search result, do you?

For me MSN search in 'most' cases let's me find what I want, if not then I pop over to Google for sure as the number of results might then help.

I'm not sure that Google can 'take over the helm'. What you have to remember is that Microsoft are experts at surviving and coming up smelling of roses! MS will survive and probably will still be number one in five and ten years and maybe beyond.

Google = Youthful drive and expertise
MS = Mature, savvy, clever and quick witted.

__________________
Jabbs
"The More I Know, The Less I Seem To Know!"
Anything IT & Support Forums

I can't see ANYTHING bad with how Google aggressivly develop new services and improve existing ones. Yes, it's possible to say that GG becomes pretty much like Microsoft, but it's not accurate at all! Personly I don't have anything aganst Microsoft, it's a great company, the problem is it's become a dominant on the market and till recently she was the only company which is capable to dictate rules.

But the situation has changed, now we have Google and Yahoo has been taking part at this BIG 3 competition. We all see how dramatically changed Microsoft approach at what trend is the most important right now - Search Engines and that's Google achievement! Yes, we live at information age and a company which develops software to handle with this increasing ray of information is a winner. These days we need search engines not only for the Internet but for our own PCs too - Google gave us Desktop Search and Microsoft and Yahoo have to follow, it's about a competition. So no more monopoly on the market which is great!

One again I can't see any problem with how Google has been growing and I don't really think it'll repeat Microsoft way with becoming a sluggish company. The reason for this believe is Google can always look at Microsoft as a sample and warning - be carefull, no matter how big you are you have to be mobile in terms of strategic thinking and creating.

__________________
Artyom Diogtev
Website design and development http://envisionext.com

" Could a Google distributed operating system be next on the list? "

About this, I think Microsoft may not be worried. For years Windows is almost the same, a little better and for Microsoft the best they could.

For a better operating system Google may be have to invest years of work.

I have absolutely NO problem with Google (even if they are looking for world dominance!) The difference between Google and Microsoft is...Google actually works and feels almost transparent to the user. Everything Microsoft does seems (to me!) to be bloated. cumbersome and slow. I use a Macintosh PowerBook (OS X 10.4 Tiger) not because my Mac is faster than a PC (it's slower!) or because I think PC's are rubbish (I don't!) but because the software systems (OS & applications) are so tightly integrated. If I could have the same level of functionality and integration with a PC, I would probably use one!
Google simply works!
I think the next revolution will not be CPU speeds, but software integration. Xerox had the right ideas back in the 70s even if they couldn't make it into a commercial product.

John

Rich may be putting a lot of faith in areas Google hasn't proved themselves yet- Google Talk for instance. But his point still stand that between their SE, News, Talk, etc. They have a lot going for them, and everything they have tried so far has worked.

__________________
Community College Planner

Okay, I think the author's article might be a bit of an over-statement as to the current state of Google, but probably not as to the long-term growth aspects. I’m not so sure that we’ve even hit the tip of the iceberg when it comes to Google’s plans and potential. What people are seeing is that Google is basically acquiring a lot of seemingly unrelated pieces, but they are missing the fact that there is a purpose in doing so, and subterfuge isn’t bottom on that list. Seoguru made the valid point that none of their “items” have anything to do with their core competencies. True... now! But don’t paint Google into any corner just yet. They haven’t even been around long enough to define themselves as a company. Google is building new competencies and won’t even be thought of as a search company in another 5 years.

Now they are getting into television (CURRENT station), here comes VOIP and messaging clients, and desktop search ties the user closer to Google. Who cares if Longhorn will have one built in? Do you recall the second person to step onto the moon? Google Desktop will have accomplished what it was supposed to and Google will have moved on before MS actually distributes Longhorn.

With Google’s new Local Beta, local directories are a thing of the past and so will be many services. Try a search for “Marriott Chicago” and look at the local results. Not only do you have all the relevant info you need, it’s going to be a snap for Google to simply install booking functionality. Anybody want to buy Expedia? When you control much of the traffic for an industry that you want to move in on, what’s to stand in your way? Revenue is waiting to happen.

Who cares that they bought their maps program? (So did Yahoo by the way) It’s theirs and it’s by far the best. Comparing Google maps to Yahoo maps or Mapquest is like comparing the Sears Tower to a child’s erector set.

Does anyone remember that Google is now an official registrar? Why aren’t they registering domain names? Simple, they don’t care to. They just want the info that comes with that designation.

Lets’ not forget that Google already has more bandwidth and storage capability than you can dream of and buying more every day. Imagine a call to your supplier ordering yet another OC48, and oh yes… another million or so terabytes of storage… for this month.

Google’s toolbar can install hyperlinks where there are none (more revenue waiting to happen) and the Google browser cannot be too far from distribution. MS has been building on the same IE 4.0 platform for about what… 8 years now? And they haven’t come out with any significant upgrade since IE 6.0 about 5 years ago. The market is ripe. While Firefox has made many an MS-hater happy, it has not had the distribution that Google can offer up.

Can a Google OS be too far behind? It would not surprise me that MS is more than just a bit worried that they will finally launch Longhorn and then Google OS will come out 9 months later and completely hose it.

Now all these seem unrelated. However, consider how just one example of how a little bit of glue can put these pieces together into a mosaic of unparalleled proportions... and suddenly… you have a picture that you never saw before. And this is of course ONLY a possibility.

Let’s say:

Google buys one of the major cell phone companies and uses the towers, not just for cell phone access, but enables them as access points to nationwide wifi. And then, after purchasing a small but highly efficient computer assembly plant that can mass produce a single client only machine, Google launches their big plan tying it all together.

With that, Google can now offer you a $50 wireless access device (let's call it a Googler), and for a mere $50 per month, unlimited Internet access, free access to all your primary apps to run over the Internet such as Star Office, email, and of course you can store your files on their system. This allows you to travel anywhere with a fold-up device the size of a small purse, have access to the Internet anywhere in the US where a cell phone can reach, have remote access to your files and apps. And oh yes – give you unlimited phone and messaging ability from anywhere to anywhere and even your home phone and mobile phone runs on the system. If you are saying that you wouldn't go for such a deal, you are in the very small minority. Believe it or not, developers are a VERY small percent of the population and one they will gladly leave to MS. But when you make life easier for people AND save them money, they will go with you every time.

As a consumer, you can forget the $700 computer, the extra phone line and dialup ISP (or cable/DSL/T1 connection). You don’t ever have to purchase another MS Office application or deal with another virus or spyware or even a firewall program. You can be driving along in your car and check email, check a map, take your phone calls, and you never have to worry again about finding a hotel with wifi. In fact, you can even book the next hotel right from your car, right on Google. Maybe it’s because I am careful of who I sign up with, but so far, spammers haven’t made it to my Gmail account in the last year. Imagine getting rid of spam too. You won't have to worry about software upgrades, incompatibilities, computer crashes, and if your Googler fails, there's probably one just like it nearby where you can just log in.

Of course they can now advertise this on their own television station now too!!! Or offer you television access on your wireless device in your home or in your car. With a camera built in, it’s video-phones and video cameras for everyone with your digital media immediately stored on secure servers that are constantly backed up. On one $50 device, you can work, play, communicate, entertain yourself, and do just about everything except for make babies. The device is secure, the intrusions are gone, 99% of the problems have disappeared, and you are saving a fortune over the poor schmucks that are still doing it the old fashioned way. And so what if someone steals your Googler. It’s useless to them and you can go down to the corner Wal-Mart and get another one.

Now are you game? Is MS worried? You bet, and so should an awful lot of other businesses. Google took the phrase "knowledge is power" and built on it. They understand that if people like your company, it's even better for business. If you save them money, they will love you, and if you help them MAKE money, they will defend you to the death. The folks at Google aren't just tech savvy like those at MS, they are people-savvy.

But not all businesses would be against this kind of a move either. If Adobe provided Google with software on a per seat basis and stopped distribution, how much would that save? And it would all but wipe out piracy. Same thing with the music industry. A lot of businesses could gain distribution by using Google as a license distributor.

Let's see... just that one example above and by buying two companies, Google can use what they already have to get into travel, wireless phones and home phone service and directories, ISPs, hosting, hardware and software distribution, television, and of course still search and much of the world’s advertising. Instead of calling it the Internet, perhaps we should rename it Googlenet. For all that, at ONLY 50 million subscribers, that’s another $30 billion per year on subscriber revenue only, and the bonus is that they place MS in a financial position that they cannot come after them.

You decide whether that's a good thing or not. But for me, I keep buying Google stock and making darn good money at it. Google doesn't have all the tools yet, but they are building the infrastructure where all they have to do is tie the services together. Their core competency isn't going to just be search or anything so small and finite. It's going to only be identifiable in large terms like knowledge distribution, entertainment, communication, and other such broad terms that nobody else would dare think of adopting.

Look at the writings of Julius Verne,

http://jv.gilead.org.il/potpourri.html

How much has become reality?

Assumption:
The human race do not destroy itself in destructive wars, epidemics, ...

__________________
Mini Network:: Financial information at your fingertips
Learn object oriented programming where it started

I've never seen such pie-in-the-sky optimism in my life. OK, I have. But that was 5 years ago. Why is it that you think Google is the ONLY company that can do this (as if Google actually could). EVERYTHING you mentioned could be done by Yahoo and MSN too. Bill Gates' personal foundation is worth more than all of Google's net assets.

People think Google is bigger and more powerful than it ACTUALLY is. Sure, there is potential and these things are possible if the stars aligned and there was a plague of locus. Your scenario is a seriously unrealistic reach and is actually less likely to happen from a company like Google. They are a SEARCH ENGINE. That's all.

There is just as much likelihood that they fall flat on their face as there is a likelihood of them creating the "Googlenet".

Oh yes, they have traffic (though they are still the #3 site behind Yahoo and MSN), but they have virtually NO registered users. They have no chat system. No games or instant messaging. They aren't an ISP service. They aren't a portal. Froogle was a great idea too (in theory) but has been a complete joke.

They have a desktop search that relatively speaking no one has downloaded. Microsoft gets more people downloading specs of "possible releases" every day than Google has had downloads of their Desktop Search in the past year.

To say they are "getting into television" is a HUGE overstatment. Some small no-name station. MSN is aligned with NBC and FOX!!

"Here comes VOIP and messaging clients" Come on, VOIP has been around for years. You act like Google is revolutionizing technology. MSN is the #1 Video Streaming company in the world and has purchased exclusive contracts with several of the worlds largest telcom and cable companies. Microsoft has been thinking about this when Larry Page and Sergey Brin were still shopping for school supplies.

You start talking about, in essence, a desktop box. A cheap machine that connects to WiFi anywhere in the country. Ummm MSN pioneered that industry first purchasing WebTV nearly a decade ago. They were ahead of their time then but they are leading the industry and are 10 years ahead in development. You honestly think Google is going to come in and just take over? And everyone is just going to throw away their home computers too huh? I guess everyone should go and dump all their shares of DELL right now then. Dell pays more in taxes than Google's combined sales for the last 3 years.

You wrote: "Who cares if Longhorn will have one built in? Do you recall the second person to step onto the moon?"

Are you kidding me? You are comparing Google's little science project to walking on the moon?
Who cares if Longhorn is built in? Try 90% of the planet that runs Windows who aren't going to want to download a darn thing. You greatly underestimate the power that Microsoft has.

Google's new Local Beta is nothing more than categoried listings. Sure if you search for "Marriott Chicago" results WILL come up that are geo-targetted. But that happens ANYWAY just through basic optimization. How about anticipating what the user is looking for when he searches for "Shoes" and hasn't typed in a city or state?

I do agree that there is money to be made if Google begins to build in sub-industries like Travel, Hotels, etc. They do have the traffic and can make money there. But the PROBLEM is what I alluded to in my first post. Many people were attracted to Google because they DIDN'T try to force things down your throat. They DIDN'T force you to purchase THEIR products or click THEIR ads. Google had a philosophy back then to be unbiased and people appreciated it, even if the results weren't always relevant.

Since their IPO they are more concerned about cashing in; finding any way possible to make a buck. This has been seen in virtually all of their services. They JUST raised their minimum bids on Adwords last week. They JUST started testing a new layout for their natural listings where 20% of the results will now be ads. (only 7 natural listings on the first page). And though it MAY make them a few extra dollars, they are coming very close to losing their core supporters that got them to where they are. Let's be honest here. Yes, Google produces the best results right now but it is not by the wide margin it used to be. And their results are getting worse not better. This isn't just my views, people have been saying this across the Internet for the last 8 months.

Yes, we all remember Google is an official registrar. It is common knowledge. And yes, we all know they wanted access to the ICANN database so they can try to weed out spam sites or work a few more latency factors into their algorithm. But I'm not sure what your point is.

Why are you talking about Bandwidth and storage? As if you actually think it is GOOD that they are required to keep spending money just to stay level with their current business operations. Yahoo and MSN also have warehouses of servers and multiple OC48 connections. It is no big deal. Maybe you are too easily impressed. Again, Google is NOT the most visited site on the Internet nor do they have the biggest data infrastructure.

Here is a fact. I can create more pages in 1 day at the cost of less than 1000th of one cent per page, than Google can keep up with for a whole year. You don't get it. They CAN'T index the whole Internet, which was their original goal. I've built millions of dynamically created pages that cost me nothing but Google has to keep sucking these things up and storing and storing and storing. Then they have to purchase more CPUs to process and analyze all of the pages I just created. It isn't hard to make Google spend $1000 for every $1 I spend.

You talk about Google's toolbar installing hyperlinks. Well they didn't invent that either. Furthermore the toolbar market is decreasing not increasing. With privacy being the biggest concern these days companies are finding ways to combat spyware.

You have one HUGE misconception. You think that because Google has visitors it automatically equates to downloaded software (new browser, desktop search, toolbar, or anything else). This couldn't be further from the truth. I guess I have to say it again... Google is just a search engine. 95% of their users use the Google search and nothing else. The average person doesn't want to download a darn thing. Many people don't even know how. The public is not as savvy as you might think. Just look at the most searched terms on the Internet. You'll find things like "Amazon.com" "Ebay.com" "Yahoo.com" "Google.com". People don't even realize that you can actually type in the web address into the address bar. Heck, you get people going to Google and searching for "www.yahoo.com". This is the silent majority of Internet users. These people are not the the kind of people that start downloading and installing programs and software. That is why Microsoft has such an advantage. These people use the programs that their computer came with.

I'm not sure how far of a dilussional knot you have to twist yourself into, to make a statement like:

"It would not surprise me that MS is more than just a bit worried that they will finally launch Longhorn and then Google OS will come out 9 months later and completely hose it."

Yeah, Google is going to take down Microsoft Windows and IE which has been the undisputed leader for nearly a decade.

Honestly, I was more impressed with Google 3 years ago when they controled over 80% of the search market. They are still the biggest but it is only 46%, (Yahoo 23%) (MSN 13%).

I love the notion of Google purchasing one of the major cell phone companies. You really must think they have unlimited money. They have Pocket Change. Have you studied economics at all? With an inflated market cap that isn't based AT ALL on actual revenue, where do you think they are going to make up the 48+ BILLION shortfall? Adding a couple text links here and there?

Looking at how the public zombies react to hurricane "Google" almost makes me ashamed to call myself American. Do we not learn from history? I'm not talking about something that happened 100 years ago. It was only 5 years ago.

Lets take a look at the numbers shall we.

Google Sales (3.19 billion)
Ebay Sales (3.27 billion)
Yahoo Sales (3.57 billion)
Microsoft Sales (38.47 billion)

Google Profits (400 million)
Ebay Profits (780 million)
Yahoo Profits (840 million)
Microsoft Profits (10 billion)

Google Assets (3.31 billion)
Ebay Assets (7.9 billion)
Yahoo Assets (9.09 billion)
Microsoft Assets (64.94 billion)

Google MarketCap (51.4 billion)
Ebay MarketCap (56.8 billion)
Yahoo MarketCap (44.37 billion)
Microsoft MarketCap (273.75 billion)

* from Forbes Global 2005

Now explain to me again how Google is going to pull off this amazing feat. If anyone has the capability, it is Microsoft. Microsoft makes 3 times more in PROFITS each year than Google's entire asset base.

I'm not saying (and never have) that Google isn't going to grow and be profitable but they are an average size company (#904 on the Fortune 1000). They aren't this huge power that everyone thinks they are. They are expanding based on stock value, not cash. This is VERY dangerous and is a one way road. It works only when the stock keeps rising, but it is economically impossible for it to continue to rise. It lacks the profits or even assets to back it up. This is how a "bubble" is created. It grows and grows based on speculation rather than actual numbers and eventually the thing pops.

Listen, I appreciate the dream. It certainly is a good story and a nice "what if" scenario but just like I said in my last post.... how about some reality please.... no SERIOUSLY.

SEOGURU how long you've been working at MS?:-))) Just kidding...

I've read your post and...I'd like to reply with 'time will see...'It's true that nobody knows the future...but Google is only 7 years old. Please do not compare it with Microsoft in terms or maturing, it's simply incompetently.

__________________
Artyom Diogtev
Website design and development http://envisionext.com

Are you really Robert Scoble?

Actually, this is a great debate. One of the better ones we've had on here. I'm just curious as to why know one has championed Jeeves?

Google seems to innovate the Internet, but they make most of their money with old ideas.
I was working at Austrias first Search Engine, Intersearch.at (gone, partially bought by Endemann (Abacho.de)).
In 1999 we integrated a system, that delivered advertisements fitting to the search items of an user. Google now has Ad Sense. It is not new, nor their idea.

Regards
Thomas L. Heltschl, Mag.

what, exactly, have they done that deserves championing? leaving the finanical winner that is Google AdWords?

altho, now that they've removed a number of the sponsored listings, their SERPs are much easier on the eyes...

__________________
Former WebProWorld Admin
IntentionalFoul.com

seoguru

the thing you fail to mention about google is that ALL or their earnings come from search-based advertising.

that is not the same as MSN, Yahoo, eBay, and the others you mentioned, which makes a huge difference. you also discussed how MSN and Yahoo were the top sites and they are. but Google is THE most popular search engine at almost a 2-1 clip. and since search is the second most done thing on the internet (email being the first), this means people actually leave MSN and Yahoo to use Google in order to search. This is a claim neither one of these companies can make, at least not yet.

as for Gmail, once the sign-up is open to all, and i don't mean SMS crap either, it will continue to do what it has done since its launch: grab more and more users away from the established email providers. especially now that they've added the new mailing and receiving options.

__________________
Former WebProWorld Admin
IntentionalFoul.com

I know I'm coming down pretty hard on Google, but I just want to make it clear that I LIKE Google. I want them to succeed. It is just everyone else I'm fed up with. It is the public that has completely lost touch with reality. It seems the average person invests more on emotion than logic.

It is certainly very healthy to have a young passionate company like Google shake things up. They have kept Yahoo and MSN on their toes. They have not only nurtured innovation themselves, but they have also inspired innovation by their competitors. The difference is that I don't let those intangibles warp my sense of economic reality.

I actually think it would be pretty awesome if Google, MSN or anyone else was to consolidate technology (computers, broadband WiFi, search technology, and other consumer and business services). Like Wal-Mart did to the retail market, consolidation usually equates to better deals on the consumer level. However, I just don't think Google is in a position to pull this off. In fact I don't think they are even in a position to sustain their current operations and growth rate. If anything, I think new competition in Contextual and PPC advertising with decrease their revenue.

It is a slippery slope. They will do whatever they can to keep their stock proped up. So instead of reporting growth by gaining marketshare, they will report growth by continually raising the rates of their services. Suddenly people who were making $1000 per month on AdSense will be makeing $850... then $650. Because Google has never actually come out and said what percentage people get, how do people know if they are getting screwed? It is the ultimate in "funny math". They could probably get away with this being the only game in town, but what happens when Yahoo and MSN see this chink in the Google Armour?

Not that they would.... BUT, Microsoft has so much in CASH RESERVE that they could just give away 100% of the revenue to advertisers just to F**K with Google and destroy their revenue. The biggest problem Microsoft has isn't AOL, Google, Netscape, Yahoo, Apple, or SUN.... it is the FTC. Their biggest mistake was their own arrogance. If Microsoft stayed low key rather than pissing off everyone including the US government, they would be twice as powerful as they are now.

Ok, so here is my prediction that is much more likely to happen. I think Google will grow but it wont be in Search. Their market share in Search will actually decline and begin to even out (which makes sense because most large industries have a "big 3"). Google will probably venture into other areas and they will probably try to slowly morph into a portal (closer to the Yahoo of today). This would be a smart move when diversifying their revenue. I don't think they are going to launch their own operating system or notebooks or cell phones, etc. They MAY try to partner with someone to offer Internet access, much like Yahoo and SBC.

Since we like the "what if" scenarios, how about this one.

(Yahoo merges with Google (Yoogle) to take down MSN.)

Ok, hear me out.

- Yahoo is the worst of the search engines right now, Google is the best.
- Google doesn't have an Instant Messenger, Chat System, or a full portal and Yahoo is the #1 most visited site on the Internet.
- They both are about even in Sales. But Yahoo's profit would boulster Google's growth, while Google's stock price would increase Yahoo's growth potential and marketcap.
- Google Maps would enhance Yahoo's cheesy maps system while Yahoo's directory could finally replace the dumb-ass DMOZ that Google uses.
- The massive Yahoo Shops would give legitimacy to Froogle and would enhance that service.
- Google email technology could merge with Yahoo's gigantic user base.
- How could MSN compete with a combined giant of Overture and AdWords?
- Yahoo's Desktop Search is light years ahead of Google's and MSN's since they have been working on it for 6 years but Yahoo doesn't have the recognition or credibility in Search that Google has.
- Yahoo and Google both have toolbars that I'm sure can be enhanced with each other's features.

I just think, if there was a "what if" scenario.. this one would make sense. MSN would really have something to be worried about.

Even though MSN has enough money, the FTC would never let them acquire Google or Yahoo. But a Yahoo/Google merger (if positioned correctly) might fly.

Just my thoughts.

SEO GURU

I do mention that their earnings come from basically 1 revenue stream. It enforces my point. Google has all of its eggs in one basket. And the basket is getting smaller not bigger. 80% market share in search 3 years ago, 46% now. Nearly 100% of the Contextual ad market. Well... we both know if can't go UP from there.

Yahoo just released their beta Contextual Advertising system a couple of weeks ago and MSN is already testing their beta PPC system overseas.

Competition certainly will not HELP their earnings.

Companies with marketing budgets will now have more viable options to persue. Sure, maybe they reserve the lions share of their budget for Google AdWords because of the VOLUME of traffic. But you can get the same QUALITY of traffic from Yahoo and MSN and if you are paying 20% less per click,... that will be a serious influence on advertisers nationwide.

Where Google was getting 90% or more due to lack of competitive services, what if they got the percentage equal to their market share... 46%. Let's see what that does to their stock price.

my bad on missing that, but as for your point, doesn't that speak volumes about Google's advertising strength? Yahoo and Kanoodle and a bunch of others have been around long enough to make a dent in Google's AdWord earnings, but they haven't.

the fact that Google's earnings are near their competitors, even tho their revenue comes from one stream, says a great deal about them and it also sheds light on why they are working so hard to diversify their services.

however, if the nationwide free Google WiFi service ever does come about, they may not need another form of revenue because their ads will be absolutely dominant with their sheer numbers...

__________________
Former WebProWorld Admin
IntentionalFoul.com

Wow! Such hostility... and that from someone who creates his own facts, hoping nobody will check them. I am so sorry that you are fed up with everyone else. I am pure moist with grief (sigh). You and I can have differing opinions on such things, but essentially using bogus numbers to win an argument and essentially call someone an idiot is not only bad form, it’s intellectually dishonest and dangerous.

"Lost touch with reality"? Um... no! But then you would have said the same thing about an opinion 7 years ago if I told you that there were these two college guys Page and Brin who didn't like each other, but they were going to start up out of nowhere, and by 2005 completely trounce Yahoo's search share, all but wipe out Altavista and Excite, go IPO, achieve an $80 Billion market cap about equal to AOL and Time Warner (once they merged), and mix affiliate advertising with on-the-fly contextual definition to financially support millions of web developers worldwide and completely dominate network advertising. There's YOUR version of pie in the sky, 1998 style. Yet here they are. It can be a strange world out there. But what is described above is far less of a stretch than Google doing anything else.

Oh yeah, you might want to check REAL figures. I didn't bother checking your other stuff because after I saw you say Google's market cap was $51.4 Billion when it's actually $79.9 Billion, I decided that it wasn't worth the bother. Oh well, what's a $28.5 billion discrepancy between friends. You were only off by 55% and of course anything less than 60% is just within a reasonable margin of error, right?

And while you quote Microsoft's annual profit of $10 Billion, Google achieved over $700 million in the first two quarters of this year (annualized at $1.4 billion), not $400 million for the year as you state. Again, being only a billion off in net income... just off a tad! You cannot compare MSFT annual with GOOG by the quarter and do so honestly. There are still a few of out here that will catch you and call you on it. Nope, it's not Microsoft, but then again, Google isn't mired into a system that they have to maintain. If Google were to come up with something similar to what is described above, MS money wouldn't matter. They couldn't PAY people to stay on a desktop and use Longhorn.

But backing away from your reality for a moment and back to the REAL reality...

Starting with nothing and in 7 years achieving an $80 billion market cap... what do you think they can do over the next 7 years, when they are starting WITH that $80 billion market cap? If they run it the same way with the same smarts and the same success, I'd say they could do just about anything they want.

As for their ability to buy a cell phone company, perhaps it is you that should study economics. While you've been running around saying that Google cannot do what they are already doing, BellSouth purchased AT&T wireless, and they are still only running on a $43 Billion market cap. Don't tell me that Google couldn't structure a deal that a company half their size could do... especially when everyone thinks that Google cannot make a bad business move and nobody that has to deal with them likes BellSouth. Verizon is but $90 Billion and they are one of the largest out there. Dollar for dollar swaps are quite common, and moving into wireless would hardly create a trickle of concern at the SEC because they aren’t merging two like companies.

As for what Google will do, mine was but an example. But your assertion that search is Google’s sole core competency is just so beyond ridiculous that it warrants no further comment, and it creates speculation that you don’t even know what the term means. I mean honestly, who the hell are you (or I for that matter) to state what their core competencies are? Yet here you are stating them as fact and blasting them for not sticking to what YOU think they are. Ya gotta love a financial advisor who pulls up to your house still driving his patched up 1979 Yugo.

What Google will do is up for grabs and I doubt they even have any idea where they will be in 7 years. The only thing that I can tell you they won’t do is care what examples I make, and neither will they care what some one-horse SEO guy that depends on their algorithm for a living says they cannot do, especially one that touts his own economic prowess and expertise over everyone else that he is fed up with, yet pulls numbers out of thin air to supposedly prove his point. Next time you want to bad-mouth someone and essentially call them an idiot, perhaps you should do it by creating your opinion (not even an argument) on something resembling the truth.

I’ve run into people like you since the early 90’s, only then they were telling how MS was just around the corner from complete collapse. AOL was going to bury them, RedHat was going to steal their entire market, the SEC would shut them down, Intel was going to stop cooperating with them, Apple was going to come back with a better system and smash them. Same stuff, same lack of insight, same negativity… SSDD, different “Expert”. There’s always one guy out there (who usually drives his Yogo of a company) who is willing to tell others what the multi-billionaires are doing wrong and how he’d do it better.

How funny it is when your entire argument is based on Market Cap, which itself is a mythical number, rather than net assets or gross revenue.

My figures came directly from FORBES, which I'd say are pretty damn credible. It is interesting that you did not post the source of your figures.

I don't have to make up anything to fortify my position. The facts fortify themselves. It is also humorous when people like you say:

"you can't compare them to Microsoft..."

Why not? MS is their #1 competitor.

Do you think Microsoft is saying. "Well, lets cut them some slack, after all they are just 7 years old."

And of course you love the tear-jerking statements, "Yeah, but look at their market cap that they got in just 7 years."

WHO CARES!!

Since your entire argument is based on something you don't even understand, let me educate you.

Market cap, is calculated by multiplying the share price by the number of outstanding shares. It is an arbitrary number because the share price itself is arbitrary.

Market cap does not accurately reflect the fundamental situation of the company, because it is significantly dependent on assumptions about the future. A company's market cap is often many times larger than the company's book value or earnings because there is the assumption and anticipation of earnings growth (whether or not is actually happens).

The first reason for an inflated market cap is anticipation of future growth in cash flow. The second reason is price increase from pure speculation of higher price, usually because of a large price increase in the past.

It is "reactive investing" and PR hype that snowballs the price and therefore increases market cap. It is the people who invest because they heard a story on the news or their broker told them to (though he is getting a commission) or a friend said they should. People who invest of the sake of investing. Meaning, they couldn't care less about what Google is doing or will do. All they know (or think they know) is that if they invest today, the price will go up tomorrow or a week from now. As I stated before, the public is gullible. THEY.... DON'T.... CARE about the actual numbers.

This is called Hype. Tell me to slow down if I'm going to fast for you. I'll try to use small words.

It has virtually NO BASIS IN REALITY or current earnings. And it certainly does not reflect current cash flow or buying power.

Now... there is a figure that tries to calculate over/under valuation. P/E ratio. The PE ratio of a stock is used to measure how cheap or expensive share prices are. It is commonly thought of as the most consistent warning flag to excessive optimism and over-investment. By relating price and earnings per share for a company, you can analyze the market's valuation of a company's shares relative to the wealth the company is actually creating. The higher the PE, the more over-valued the stock is.

This summer Google's trailing PE ratio exceeded 140, which means people were paying $140 per $1 of earnings. That is GROSSLY overvalued. But let's give them the benefit of the doutbt because it was the PE Ratio from the previous 12 months. Obviously the public expects the earnings to increase. Based on future earnings (again Google is the master of selling smoke) the PE ratio is still over 60. $60 for every $1 of future earnings. That multiplier is RIDICULOUS. No matter WHAT Google does, they can't live up to their valuation.

The greatest bull markets in history have started at times of low PE ratios. The bull market starts of 1921, 1932, 1942 and 1981 all occurred when the Sp500s PE ratio was around 7!

If a stock price is overvalued it is usually because there is a high demand for it. Hype for the stock has caused people to buy the stock for a higher price than they normally would. This is called a "bubble". You DO know the term "bubble" don't you? Historically, bubbles have been followed by crashes.

The irony is that companies actually WANT a higher PE ratio because management is primarily paid by their companies stock (which is supposed to align their interest with other stock holders), and to make the stock price go up they either must improve earnings or improve the multiple the market assigns to those earnings (market cap). Efforts by management to convince investors that their companies will experience massive growth has a profound effect on the PE ratio, which effects the Stock Price, which then effects the Market Cap.

Are you catching a theme here? The WHOLE THING is based on hype. Their JOB is to convince investors why the company is worth more than it actually is. Their REWARD is to have people buy the stock, which increases demand, which raises the stock price, so they in turn make more money.

This isn't just Google... this is the basis for the entire stock market which is why it is so out of whack. Like I said in my previous post... Google has the best PR team I've ever seen. Launching their IPO right before a holiday season... damn that was smart. They have really fooled everyone.

You can certainly base your views on Market Cap if you want. I would rather not base my decisions on something so arbitrary.

If you would listen to yourself, everything you are saying is based on non-monetary factors. There is no doubt that Page and Brin have accomplished something amazing. I AGREE WITH YOU. That has never been in debate.

If you want to predict on blind faith in two guys who "accomplished so much in just 7 years" then that is certainly your choice. I prefer to use realistic indicators rather than some kind of emotional chord.

I'm not saying your scenario is impossible. I'm saying it is improbable based on the economics. I'm saying that they are a great company that has provided great innovation in the industry but they ARE NOT as powerful as people think. They are grossly overvalued.

Even though ALL of my facts and figures were correct... let's just give you the benefit of the doubt just to make my point. Heck, let's even say it is HIGHER than what you stated.... ummm is 100 billion market cap high enough?

OK, EVEN if that was the case. It is irrelevant. I think we can all agree that Google is not bringing in 100 billion per year in sales and certainly not in profits. So at some point, the stock price MUST (by definition) even itself out. Again, we just went through this 5 years ago with the dotcom crash so this shouldn't be too difficult to comprehend.

Google has "fake money". Meaning their currency is their stock price. And if their success is determined by their ability to keep their overvalued stock price rising, I do not like their chances.

You must be pretty damn warped to think money doesn't matter. To think that after all of the companies who have tried to take Microsoft down, GOOGLE is going to be the silver bullet. I can't even believe someone like you that seems to be fairly inteligent would make such a bonehead statement like:
I hope you are joking and just saying that rhetorically. You are saying that Microsoft's 7 year dominance of the OS is just going to crumble at the feet of Google? Microsoft's exclusive contracts alone would keep that from happening.

Even your example of BellSouth purchasing AT&T wireless was again compared by that rock solid "market cap" figure you love so much.

You actually question that Google's sole core competency isn't Search and PPC? Now you are just in flat out denial. Do you think I just pulled this out of thin air? By definition, a company's core competency is the one thing that it can do better than its competitors. You're right, that can't be Search or PPC. I suppose you would also argue that they don't make virtually 100% of their revenue from AdWords and AdSense too.

I obviously can't have a rational conversation with someone who is irrational (or at least hyper-emotional).

How hypocritical it is that you question my views when they are based on actual numbers. Especially when your whole argument is based on market cap. You may want to scroll up and read the it again since I seriously doubt you understood it the first time.

Anyone who reads this can see that you are more concerned about bashing me than producing any kind of legitimate argument. Seriously, what's taking you so long... me and the rest of the readers are still waiting.

ROFLMAO - Didn't think that I'd have to look it up for you, as it is freely available to anyone with a browser who knows how to use it, but here it is:
http://finance.yahoo.com/q?s=goog

Or if you don't like them, how about CNN Money
http://money.cnn.com/quote/quote.htm...true&symb=GOOG

Look it up. Oh and here's your famous Forbes:
http://www.forbes.com/finance/mktgui...jhtml?tkr=goog

Yeah buddy, you might try reading just a bit. Check just below the quote, it is dated, "Forbes 2000 data as of 02.28.2005". So since Google hadn't even released end of year 04 by that time, you are only quoting stuff a year old. I for one am glad you are in SEO and not financially advising anyone. A company could be bankrupt and you'd be telling them to buy heavy. You're killing me here!

You are the one that brought up market caps and talked them blue. Now you want put it on me? Sorry dude, you gotta own that one.

Now you want to talk about GROSS REVENUE huh? How silly! GROSS REVENUE has nothing to do with anything other than as a starting place. Ask anyone who owns airline stock. How about GROSS PROFIT? Still irrelevant, but at least you're closer.

BTW... cap isn't arbitrary {def: Determined by chance, whim, or impulse, and not by necessity, reason, or principle}. Just because prices change doesn't mean price is arbitrary. It's called the market. It fluctuates, it's not arbitrary. On a daily basis, so do sales, profits, expenses.

Cap is not the end all, but it is an indicator of growth and relative market perfomance to others in the same market. NASDAQ, Forbes, Yahoo Finance, WSJ, Ameritrade, Scott Trade, CNN, Schwab, and everyone else uses it as an indicator. But Seoguru says it's irrelevant?

Besides my own experience which is substantial, thanks, but no thanks, your opinion compared to theirs??? If I knew nothing, I'd go with NASDAQ over you any day. ROLFMAO

As for your supposed "education". No thanks. I don't take instruction from people who cannot even get the facts straight and get nasty using their year old data.

Don't misquote me either. I didn't say that you couldn't compare MSFT with GOOG. Comparing them is exactly what I was doing. I said you cannot quote MSFT annual and compare that with GOOG quarterly. It's no wonder you cannot get your facts straight. You cannot even follow a quote from one paragraph to the other, and then you cut it off and throw in 3 dots to take it out of context to bolster your opinion. At least be intellectually honest with yourself.

Of course MSFT isn't saying they should cut GOOG some slack because they are only 7 years old. I rather think they are saying... "Damn, they're only 7 years old."

And what do you mean "Who cares?" Anyone who doesn't care that a competitor (no matter their size) is coming up their backside at the rate Google is coming is a fool. But you aren't in bad company. I seem to recall Chrysler said the same thing about some Japanese upstart called Toyota who was making small cars, and also Barnes and Noble when they heard that trifling little Amazon had just received funding.

Who cares how fast or what Google does? Well, I suppose nobody unless Google can threaten their business model. In your position for instance, I wouldn't worry about competition either. Some lone SEO guy who has to label himself a guru probably doesn't have to worry about competition much.

As for core competencies, don't even go there. All you see is all you see, and just because you don't, doesn't mean it doesn't exist. Google has network and system security people bar none. They've stolen key people from MSFT, the NSA, and some of the top programmers in the world.

This is a company ready to move, and neither of us can define their core competencies because unlike MSFT who likes to brag about what they WILL do, GOOG keeps it close to the vest and quiet until they are ready to go.

It's a lesson that MSFT should learn. Nobody would be laughing about the delays in Longhorn if they didnt' announce several years ago that it would launch the product in 2004, no wait... 2005, no wait... 2006, "but only if we remove WinFS". It will be 2007 before it's all done with and then we won't be able to tell the difference between that and XP.

Actually, I take that back. People would still be laughing when MSFT says one of the key features of Longhorn will be desktop search (no kidding... there's innovation for you) and the ability to patch the system with 50% less reboots. ROFL Translation, it's screwed up and we know it, but you will be able to fix it quicker.

MSFT is worried. They have to support Windows, they have to keep going that direction. And they know that when someone does finally come up with a $50 portal machine that can access anything, anytime, anywhere off a free OS that won't crash or be susceptable to viruses, people won't be tied to their expensive lugs full of wires sitting on their desks. Windows will go the way of running off DOS copies stored on 5.5 in floppies. If Gates thought that the only thing GOOG could do was search, he wouldn't waste the time talking about them. I've heard or seen 3 recent interviews with him talking extensively about GOOG. Not a single one with him talking about Yahoo, EBAY, or Amazon. Makes ya think... well at least it makes anyone think who isn't blinded by Microsoft light.

Do I think MSFT is going out of business? Heck no, they have too much money and too many brains to to that. But like Holiday Inn and Ho-Jo who dominated their markets 40 years ago and got complacent, MSFT will be yet another good company, not own the world any longer.

Are my cheers for GOOG? You bet. I bought 3200 shares at 96 and now it's 286. But am I blinded, heck no. With nearly a mil at stake, I am eyes quite open and I don't put that much into anything unless I know it's sound.

Have you abandoned all reason? I almost have nothing to write because you are saying the same things you said before.

Then again, I said ALMOST. So..

I have looked up current filings on Google and have compared to past growth. I didn't say the Forbes figures were as-of-today. But I DID say they were accurate and they made my point. But in my last post I even gave you the benefit of the doubt and the numbers are still irrelevant. With a forward PE ratio at 84.85 (as of today), Google still can not live up to their valuation. Are you HONESTLY saying they aren't overvalued? Seriously, aside from all of the crap about how good they are and what they can do, blah blah blah. You seriously think they aren't overvalued with a forward PE ratio of 84.85? That is 84 times their current earnings. Microsoft has a PE ratio of 24.15, Yahoo (30.17).

You seem to think I brought up this Market Caps debate. Please tell me the other message board you must be reading. I listed some numbers as a relative and accurate reference between Google, Yahoo, Ebay, and Microsoft and you flipped out about how their Market Cap is this and Bellsouth's Market Cap is that...

It is hard to argue with utter gibberish. I've been talking about Gross Profit this whole time. Now suddenly you agree with me about profit. Well, at least you are off your Market Cap kick..

Wait... here you go again. uh oh.

OMG, you actually just gave a definition that enforces my point. That is exactly what I'm saying.

Since we are in the mood for definitions here is another one:
{Arbitrary: based on or subject to individual discretion or preference or sometimes impulse or caprice}

Since price on "momentum stocks" such as Google IS fundementally based on impulse, chance, and not by reason or priciple (like someone investing only for the chance of a higher price), then YES, the figure is arbitrary. Certainly, a reasonable person couldn't think Google could grow at the rate their PE ratio indicates.

I greatly admire the astute argument that because everyone uses something, it makes it a great indicator. You obviously didn't read what I wrote in my last post on how market cap and valuation works. Please take this time to read it again.. I'll wait....

Finished? Good.. and since I explained how a "bubble" and overvaluation occurs you should realize that Google has created a bubble in their valuation. Their cap is significantly inflated. This isn't opinion, this is fact. Unless you don't go by PE ratio (even though everyone uses that too.)

But then again, I'm SURE all of the companies you listed (NASDAQ, Forbes, Yahoo Finance, WSJ, Ameritrade, Scott Trade, CNN, Schwab) were NOT affected by the dotcom crash.... Yet they all used Market Cap as a "reliable" indicator.

This has got to be the funniest to date. You are on a roll. Especially because YOU were the one who brought up the quarterly figures, not me. EVEN if I was originally comparing accurate date from 6 months ago (not 1 year ago), it STILL was an accurate comparison. I was comparing the annual figures for EBAY, YAHOO, GOOGLE, and MICROSOFT. That IS a valid comparison.

But you bring up quarterly figures, then insist you can't compare them. What kind of backwards mind tricks are you trying to play here?

By the way, I put in the dots not to truncate but as a pause.... as.. to.. slow.. down.. so you can understand.

I'm sorry, I didn't know you were a Google insider and know everything they are doing behind closed doors. I'd go over the core competency facts again but you obviously didn't get the definition the first time so why repeat myself? You obviously have knowledge that the rest of the world doesn't have so you got me there. My apologies.

OK we are splitting hairs here. You and I can do this forever. If there is anything you read and understand please let this be it.
==============================================

We can keep going back and forth. Here is the crux of what I was saying.

Google, as great as they are (and I DO like the company) I believe is overvalued. I think they WILL continue to grow and they WILL venture into new areas but they aren't going to take over the world or create the Googlenet, or come out with their own Operating System and take down Windows, or start purchasing telcom or wireless companies. NOT that they shouldn't, I just don't think they CAN. Financially, I don't think they are in a position to do that, nor do I think they would take that kind of risk. Maybe in a few years when they have a chance to grow into the valuation they have created, they may change my mind but based on the current figures and services to date, I just can't see them making THAT kind of leap.
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That is really the only major point I was making. If you do not agree with that opinion I'll respect that. I guess we will both see.

ROFLMAO It’s hard when you suddenly find you have egg on your face, isn’t it?

"As of today"? How about even getting in the same year. These figures were reported in February, but are for LAST year. Don't try to minimize your massive error by making it sound like these are only a day or so old. You are'n't even in the same calendar year. So the numbers were off by at least 50% and as much as 350% but they are still accurate. Yep, it’s hard to argue with that logic. Maybe you should just come out and say you were right and we should simply ignore the facts… oh wait a minute… you did!

So either knew what you were saying was inaccurate or you didn’t. If you didn’t, then have the personal courage to admit that you blew it. If you did, then you intended to deceive people by purposely quoting wrong stuff. But either way, you simply aren’t going to get away with saying wasn’t up to date, but the numbers were still accurate and that proves your point. Over 350% and a billion dollars in NET profit isn't chump change bud, and it won't be excused and considered irrelevant.

That determination is based on what the perceptions are that the company will do in the future. According to you, this company doesn’t have much of a future so by that theory, I do think they would be over-valued. However, once again reverting to the real world, they’ve got a lot of stuff brewing that you seem to be in denial about, and whether you want to accept it or not, the revenue growth has been phenomenal without any sign of slowing. Unfortunately, MSFT cannot make that claim. They cannot get their next OS out the door and while their stock hasn’t tanked, it has gone down.

Nope, not the debate, just the completely wrong numbers. And then I corrected you and you told me Forbes was right. That’s the debate. When you misquote facts, expect people to call you on them. But don’t blame them for bringing it up when you lied about it.

Um no… Note “gross revenue”. Why is it that you are now resorting to distorting and denying even your own quotes when they are right on the board for everyone to see? I mean that is just foolish. And no, I don’t agree with you that gross profits are relevant. They are MORE relevant than revenue, but still nothing. Net profits are what’s important. Please look up the difference between the two because I don’t have the time to teach you accounting 101. I know dozens of companies with GREAT looking GROSS PROFITS that are about to file CH 11 because their NET PROFITS suck. I don’t care how much gross profit a company has. What counts is what they have after the expenses are paid.

Aside from your inability to spell, your application of the definition makes no sense. Only an idiot stock buyer buys without any reason or principle behind the purchase. Note on the English language: “Fluctuation” is not a synonym for “Arbitrary”. Humans make decisions that affect everything including sales, assumption of value, depreciation method, and more. That doesn't make the result arbitrary. The same is true when someone places a stock order. A reasonable person doesn't just give a market order for some random arbitrary number. Of course that may be how you buy stocks, but most of the rest of us have a logical basis for what we do.

Well by golly, by that logic, we shouldn’t use ANY indicator that those companies also use. Let’s just forget it all and go by the Seoguru school of by guess and by golly trading, completely ignoring all relevant factors of the company, because obviously you only do SEO for fun. LOL Sorry dude, but you sound like a guy that got totally burned in 2001 and still hasn’t gotten over it. Just because a company is doing well doesn’t mean that it is set for ruination. On the other hand, I lost about 1% in 2001 because I understand the whole picture and knew what the bubble was. Sorry Bubba, ain’t no bubble here.

Nah, I just couldn’t figure out what you were talking about because the numbers you were quoting were bogus. I just figured you were doing a lousy job of rounding their $300+ million up to $400. Little did I know you were taking figures from last year and trying to make them sound like they were from this year.
No, you use them to leave part of my sentence off so that you can take it out of context. Again, I don't know why you attempt to hide what you've done. It's plain for all. Is it a short-term memory issue or just a problem with personal integrity?

I don’t, but I see who they are hiring and so does Wall Street and so does MSFT, much to their chagrin. I know quite a few of these names and their reputations. And you don’t hire the kind of people that they do to make a better search engine. That fact alone puts me well ahead of you because all you do is look at Market Cap, Gross Revenue, P/E, or whatever figure it is that you are hanging your hat on at the moment, go check and see if Google is still online, and then report all about their core competencies like you have a clue.

But here’s the deal. Go ahead with the next round because I’m done. I am as willing as the next to debate real facts because it is educational to all and can bring up some very legitimate points. Expressing opinions about facts is one thing, but facts are facts. When you purposely post inaccurate figures and still state that they are accurate when found out, when you misquote me and take my statements out of context, and when you even deny your own quotes, this isn’t a debate anymore.

This is you trying to prove your point without regard to anything resembling reality, and being willing to distort and create your own facts to do so. I’ve pointed out massive errors in fact that cannot be disputed. There’s no point in this. Okay, you win, I concede. If you want to believe there's no substantial difference between $51B and $79B, and that GROSS REVENUE and GROSS PROFITS are relevant to a company's health, then who am I to correct you? Now you can go away for the weekend and be happy. And I can go away happy as well because while you’ve been here telling me how poorly Google is doing, they’ve gone up .40 today and made me another $1280. Oh well, sucks for me!

You have twisted yourself into such a knot that you don't even understand your own arguments anymore. It is quite sad.

You have absolutely no concept of economics or their real world application. Maybe we should just say that Google will start their own country (since they have enough money to buy their own) then they will rename it after themselves and invade the US. Or maybe they should just fund their own space program since they have enough money for that too. They'll be the first intergalactic internet provider. Let's see, they have Google UK, why not Google Mars? They can use their Market Cap to buy it. I hear grocery stores are taking Market Cap too so you don't have to use your food stamps anymore.

These things are just as likely to happen as your pipedream scenarios. It is that kind of nonsense that you've been spewing out.

Though you do have a short circuit in your thinking, it has been quite entertaining to watch your continuous backpedaling and lashing out at me rather than presenting any kind of legitimate argument. I'm actually STILL waiting for one so any time you're ready let me know.

Most people you come across are probably intimidated because at first glance you may appear knowledgeable when the reality is that you simply start an elaborate game of sidestepping one argument by starting another. Heck you even start arguments with yourself! You actually agree with things that you first disagreed with. Wow, I have to hand it to you. Did you have to practice to be this obtuse or did it come naturally? I mean, you are powerful stupid. So much so that I find it hard to believe it is an accident.

By the way, before you start talking about spelling errors, you may want to reread your own posts since they are littered with them.

And my GOD, you still won't let this "bogus numbers" thing go. FORBES IS RIGHT! The numbers were and are exactly correct! I wasn't reporting quarterly results. I never said I was. I know you can read so I'm guessing it is the comprehension you are having trouble with. I'm sure there are people that can help you with that. Maybe it's just that you see what you want to see.

And the up-to-date numbers I quoted such as the PE ratio, you just simply glanced over. Like it never even happened. Ooops must have just overlooked it. That's ok, honest mistake *wink*

Unless of course you don't look at something as factual as a valuation to earnings ratio. I forgot, you like the "mushy" numbers that just kind of float out in there with LOTS of room to play with so you can mold them to your own delusional perceptions.

You actually contradict yourself in the same post. It is so amazing to watch you self-destruct like this. It is like watching a train wreck. You want to look away but you can't. It is just entertaining to see what foolish rhetoric you'll spit out next.

I'm not sure if I should laugh or pity you.

You say that I've misquoted you, yet I'm waiting for an example. In fact, I've been waiting for 2 posts now. You keep making these claims without backing them up. How convenient for you to just throw things out there claiming you are being misquoted or that it was out of context or that numbers were bogus when they weren't. You just lay it on thick don't you? Not a SHRED of evidence to backup anything.

I love how you respond to EVERYTHING except for the fact that their Value to Earnings ratio is 84. No comment? hahahahahaha. Figures. Just skipped over that whole paragraph huh?

This last thing you said really summarizes just how twisted your head really is (I'll quote the whole thing so it isn't out of context.. haha)

Holy crap, if that isn't the dumbest thing I've read in a long time. Keep them coming though because I'm making a book of your quotes called,
"Twisted Economics" They are on a public message board so don't be asking for royalties. haha

This quote of yours is so good I just don't even know where to start. So, you put more faith in their new employees over every other economic indicator. You can't back down from this one, it is in black and white; you JUST said it. In fact just to make sure you realize what you just said, I'll quote it again so you don't miss it.

Man, I'm just going to sit back and enjoy the show. I can't wait to see how you can twist yourself out of this one, but I'm sure it will be entertaining nonetheless. Or maybe you'll talk about everything except for the things you've been nailed on just like you did in your last post. Go ahead, keep inventing more accusations since that seems to be the only thing you are good at.

Google must be hiring every intelligent person on the planet. Actually, yes, I did get a call the other day about an executive position there. But why would I want to work for a company that can go nowhere but down? I told them to go screw themselves. You can do the same.

From my standing there are at least three sides to this argument. Googlers, Anti-Googlers, and Business-Gurus.

The googlers (however slightly brainwashed) proclaim the coming of their savior. A world full of tie dyed tee-shirts and rainbows (and big colorful letters). Where the internet is fast, free, and "all the world's information is easily accessable".

The anti-googlers view google as a threat to life as they know it. Brainwashed by their own favorite companies (MSN, Yahoo, AOL, ect). Google is the new kid in town that they really hope doesn't make it. Anti-googlers are placing their faith in their favorite companys, with the motto that "You haven't let me down before, you can do it this time too!"

Business-Gurus... The third view, is a fairly unbrainwashed view. True, google's real value is far above what it's actually worth. True, microsoft, yahoo, and aol still hold the bigger market share. From every business logical view, google is just another internet fad.

That said. I'd like to present my own thoughts on the matter. I believe Google has the chance to be number one. Why?
- Inovation. Google's company model is perfect for harnessing the creativity of it's employees. From 20% time, to free lunches, to biweekly street hockey tournements. If someone has a good idea (or even a bad idea). You'll be sure someone at Google has thought of it first and it's already in production as we speak.

- Additude. Yeah, that thing your parent's lectured you about when you were a teenager. Google has the additude of a winner, and they share this additude with many of their supporters (Hence all the beautiful brainwashing).

- Goals. Seriously, what are microsoft's, and yahoo's goals? Money right? Google, cares, or at least makes people believe that they care about making the world a better and more productive place. And they've gone pretty far to prove it.

- Niftyness factor. Admit it, Google has a way of being downright cool (unless they're being scary). It's like a living breathing fad, that grows to continualy stay the hottest (just watch the counter for e-mail box space count up at www.gmail.com to see what I mean)

- Power/Progress. In a few months, google has entered the playing field for e-mail, maps, IM, and more. Things that took it's competitors years. New products are keeping people happy and talking, and Google has the power to keep them coming.

Yes, Google is trying something new. Are they going to win or lose? There's really no way of knowing. Just chill. Sit back. And watch the companies fight over you. If anything, Google has got Microsoft and Yahoo on their feet improving their products. So either way, we win.

heh. I love it when tech companies are at each other's throat. I noticed my sites were getting indexed better/faster by MSN not too long ago. You guys make some good points.

I miss the old Google.....

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Excellent Point. I think it this point which will ultimately lead to better options for consumers and advertisers. Google has simply inspired innovation. They have FORCED competitors to develop better products. Google is no doubt a major player. I don't think anyone can argue that. I just think they aren't quite as big as people think (or their stock price reflects)...yet. It will be interesting to see what happens in the next few years.

I've been enjoying the intelligent and informed debate between seoguru, papadoc and others here, and am surprised that during it noone has even mentioned Google's UNIVERSAL DIGITAL LIBRARY project... Of all their initiatives, this is the most visionary, altruistic, revolutionary, and promising from a user's perspective, in my view. There are other projects (gutenberg.org, etc), but not on this scale and with these resources.
As an aside, let me say [shameless self-promotion here] that I happen to own the domains unilibrary.com/net/org and unilibraries.com/net/org which I expect to sell to either Google itself or some competitor, eventually...
Another point: a "Google OS" has been mentioned, but, more specifically, what about a "Google Linux" distro, at least while we wait for a distributed network OS and Google network appliance to be feasible?
As for GOOG the stock, while I agree with and can envision many of papadoc's prophecies, I also think that rosy scenario is ALREADY BUILT INTO the CURRENT stock price... Stocks go up in anticipation, and go down on the fact. You would be wise, papadoc, after the run-up you said you enjoyed, to take at least some profits off the table, or place a trailing stop to protect them just in case things take a sudden bad turn. Remember Ariba (ARBA) ALSO reached an $ 80 billion market cap at the peak, when it could do no wrong.

Hi, long time lurker, first time poster. Love this community and I hope to get a nice welcome here. :)

In regards to Google: I always wanted to ask if it's just me or is Google starting a lot of nice projects but rarely finishes them?
For example, their desktop search program has been in development for quite some time. While Google finally managed to release a palatable version to consumers, it's still just a beta (yeah. Look closely. Not finished. Not at all. Still getting third party apps together. Still working on countless bug fixes.).
Gmail is a nice idea but even that one lost its momentum. At first you could only get one via invite. That was an excellent marketing idea that made people feel important - if they got an invite.
Basically, Google employed the Idea Virus strategy (like Hotmail did) by allowing Gmail account holders to send invitations to their buddies, but Gmail has yet to see the buzz Hotmail did before Microsoft purchased it.

Whenever Google came out with a new product or function I eagerly installed it/tried it out only to discover that things were simply not working smoothly (see above). This is very disappointing, isn't it?

So in short, I'd like to see Google to push out products that are COMPLETE. Keep those bugs to a minimum, make sure those third party apps comply with certain standards (don't get me started on that one!) and then market the heck out of the product.

BTW, Google's Market Cap shouldn't really intimidate anyone - Market Cap is not based on cash flow at hand but rather a speculative number comprised of factors such as projected growth, DTI ratios and so forth. And remember that the big ol' Tech Bubble from yesteryear bursted partially because of overly optimistic Market Cap speculation and daydreaming. (Okay, that's a pretty generalized statement but you get the point).

Thanks