The Great Debate UK
Apple has just lent a hand to Google in the search giant's increasingly tense relationship with regulators. The U.S. Federal Trade Commission worries Google's proposed purchase of AdMob may extend its dominance of internet search advertising into the burgeoning mobile Internet space. Apple's latest iPhone operating system will give the government less to worry about.
The FTC's concern is understandable. Google could well use the profits for a near-monopoly in its original business to muscle into the promising mobile advertising market. That business is currently small -- total spending of around $400 million in 2009 was less than 2 percent of Google's revenues. But research outfit IDC estimates $1.9 billion of revenues by 2012.
Yet the tech trade creates a dilemma for the FTC and other antitrust regulators. As the long fight with Microsoft has demonstrated, once a monopoly is established, its huge economies of scale make conventional remedies ineffective. Officials need to strike before the competitive barriers are too high to tear down.
But when the barriers aren't high, it's hard for regulators to prove they will be. The FTC isn't getting much help from advertisers, who appear mostly unconcerned about the Google-AdMob deal.
Application developers for mobile phones might be a more promising avenue. They could be hurt if Google owned AdMob, which controls about a third of the market for placing ads in mobile applications and web pages. Since apps increasingly determine the choice of phones, and developers depend on app ad revenues, Google might be able to use AdMob to pressure developers to favor its own phone operating system over Apple's or Microsoft's.
Skype looks like Silicon Valley's best hope for a blockbuster initial stock offering in 2010. With Facebook determined to stay private until next year, the former eBay orphan could steal the scene with a quick flip. Moreover, as a result of clarifying copyright issues and rewriting its code to attack the business market, the company may be worth twice its $2.75 billion price tag when eBay sold all but 30 percent of its stake last year.
The company already has 500 million users and made $48 million in the third quarter, its last before going private. That's good, but eBay wasn't a natural owner. Its core auction and payments businesses had little to do with managing a communications firm.
I have developed a practical approach to competitive success that defines strength not in terms of market share, but in terms of what I call “profit power.”
Cash, not China, is Google's biggest conundrum. More precisely, where should the search giant point its gusher of greenbacks?
The online advertising market recovery and increasing efficiency pushed free cash flow up 44 percent to $2.5 billion in the fourth quarter. Adding that to the company's $24 billion cash hoard doesn't make sense -- but giving it to shareholders does.
Google’s cyber-complaint is the tip of an iceberg. Coordinated attacks on IT systems are common, yet companies and governments have kept largely silent. The growth of computer services that rely heavily on the Internet means the stakes are growing higher. That may explain why Google spoke up about recent attempts to steal its intellectual property -- and why the U.S. State Department has also taken China to task.
The scope of the recent attacks points to a complex operation. More than 30 companies were attacked simultaneously through an undiscovered software security hole. The incursions appear to have had the blessing of the Chinese government, if not its direct involvement. It is hard to imagine who else would be interested in the email accounts of political dissidents, which Google claims were targeted.
Five years ago the thought that we could be on the move accessing applications such as You Tube or Facebook, or watching TV or listening to music using our mobile phones was no more than a dream – today it’s a reality.
If we take a step back and assess the journey of the mobile phone over the past few years it has been nothing short of epic. It has progressed from a piece of technology for the modern business person to a must-have item.
from For the Record:
Dean Wright is Global Editor, Ethics, Innovation and News Standards. Any opinions are his own.
A few weeks ago, I wrote about the Breaking Borders event in Berlin that marked the 20th anniversary of the fall of the Berlin Wall. The event, at which I spoke, took the anniversary as an opportunity to explore how the Internet is playing a role in advancing participatory democracy and free expression around the world.
Google doesn't want you to be afraid of the cloud.
The company announced a new feature on Thursday that lets people view all the personal information they've entered into Google's sundry Web-based products over the years.
The information in Google's new Dashboard covers everything from your personal account information for email and other Google services, to your viewing history on YouTube and the photos you've uploaded to Picasa. It's information that was always accessible in the past, but Google is now making it viewable in one, all-inclusive snapshot.
Google CEO Eric Schmidt has acknowledged he realized upfront that he was overpaying to acquire YouTube, to the tune of $1 billion, judged by any conventional measures.
The many critics of Google's $1.65 billion deal to acquire the video-sharing site three years ago will claim this confirms everything they have always said about the deal. Not quite.