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Google Wants a Piece of AOL?
minuszero writes "BBC News is reporting that "Google is said to be in talks with media group Time Warner about a stake in its internet service provider, AOL."
Talks are reprted to be in the early stages still, but one possibility is a "three-way joint venture to house AOL's content offering, with Time Warner retaining a controlling interest." Current estimates for this sort of move are around $5bn.
The article also claims that Microsoft has also shown interest in tieing up MSN and AOL services." Clearly Google's interest in AOL is their huge CD distribution system, widely regarded as the most advanced in the world as demonstrated by my mailbox.
When the AOL/TW merger happened I remember nearly borking when I saw how much it valued each AOL customer at. Even with $5bn we are talking of THOUSANDS of dollars per AOL subscriber which to my simple mind sounds like a ridiculous amount of money. Clearly TW is desperate to get something out of the waste of space it was saddled with, but I'm surprised that anyone would offer this much for it.
Of course part of the reality here is that MS want AOL to replace Google's search engine with their own, and Google want AOL to keep using it.
Could Google really get that much shareholder value out of targetting the AOL customer base? Or is this a great example of how the stupid valuations of 2000 are back
An Eye for an Eye will make the whole world blind - Gandhi
This move is because MS was showing interest in AOL and it looked like a deal was going to happen. If it did, it could really hurt google in click revenue, and media content down the road. I predict MS will win at the end of the day, because AOL can profit more from using MS technology and promotional content. For instance, if AOL got their software included on every copy of Vista like they did with Windows 98. They already use IE, and aol's/time warner getting integrated into Windows Media player would be huge for them. Microsoft's IPTV stuff is one more reason MS will spend whatever it takes to get time warner. For all you Google lovers, you better hope google doesn't blink here, or they will be in some trouble.
AOL users get Google's search power built into the AOL client while Google gets to target AOL users with their advertising. It's a win win situation for both companies. With the money they make from a partnership like this, both companies will go through the roof. Am I the only one who Google is making nervous?
AOL is actually the kid everyone wants to be friends with again. They've revamped alot of their business and are expected to have a strong come back. I know it sounds impossible, but thats what Wall Street is saying, and Wall Street doesn't just put its money anywhere.
Regards,
Steve
Well, perhaps Google would then be able to convince Time Warner that federating IM is worthwhile. If that's the only thing that would happen from this then I'd be happy about it. Especially with MS and Yahoo! supposedly teaming up.
This has nothing to do with anything more than Google trying to "divide and conquer" a potential M$+AOL future.
M$ strategy: Embrace and extend all NON-Google online assets to make it a two-party game.
Google strategy: Marginalize M$ as deeply and often as inhumanly possible.
MS and Google can NEVER share space. Even if Google buys a tiny percentage of AOL, it's enough to poison the well so that M$ cannot usurp AOL into its own.
Aside: It's become clear that AOL is comfortable in its role as bastard-manipulatee.
Stop speculating on anything else, guys.
Makin' money, makin' friends, makin' whoopee and wearin' Depends
Microsoft/Yahoo versus Google/AOL.
/readies popcorn
It would have been a fine deal, if TW had given AOL shareholders about 1/8 of the company instead of half, and if AOL had been immediatly lumped in with the cable business and the two groups told to settle differences now and get working on AOL over cable broadband. Since hindsight is 20/20 niether happened but most of the carping is over the price paid. Good for AOL shareholders (who don't realize how little they would have if Case hadn't sold the company) but bad for TWX shareholders. Unfortunatly the timing of the deal meant that both groups blame the merger for the corporate ills rather than the popping of the bubble.
Degaussing scares the bad magnetism out of the monitor and fills it with good karma.
I agree that it really does not matter what happens to AOL. They have done nothing but lose market share over the last few years. In fact, I'm seeing many parallels between AOL and Excite@Home. Within a few years, I think AOL will meet the same fate.
- Google remains the preferred search engine for AOL
- OpenOffice.org begins to appear on CD's being mailed out to everyone
- Google could use AOL's POP's to provide a Google-branded ISP
The synergy potential is actually quite significant -- very much moreso than an AOL+Microsoft combination, which was clearly intended to do nothing more than muscle Google out of the search market.Tired of FB/Google censorship? Visit UNCENSORED!
"Seriously in the long run it doesn't matter who (if any of the two) wins, the fact that there is competition now will hopefully mean better products, innovation and hopefully an overall better deal for the consumer."
I seriously hope Google does buy a large chunk of AOL from Time Warner. Historically, Warner Communications favored 50% co-ownership deals and even tried to sell 50% of Atari Inc. back around 1980 to IBM. Investing in AOL would not only be wise, but a defensive move against further incursion into Google's main business by Microsoft. For example, a Google led AOL would have the courage to switch the main AOL web browser over to Firefox (something Time Warner is too scared to do). If they were smart, they'd do it like the current version of Netscape...default to the Gecko rendering engine, but if the browser detects non-compliant code favoring IE, the browser renders using the IE engine. But what Google could do differently is have the browser auto-report the site back to Google, which could lower the rankings of that webpage in Google's search database unless the site owners recode their page using standard practices. In less than two years, you'd see IE specific webpages a part of history and it would severely weaking Microsoft's influence on the net. Google/AOL could continue this dual rendering engine practice until 2009, when the AOLTimeWarner/Microsoft agreement ends, or sooner if the IE specific pages disappear en masse before that date.
And that's just a small piece of what a piece of AOL would mean to Google. I'll leave the other posters to ponder the impact acquiring AOL Instant Messenger and ICQ would do for Google Talk.
"Right now, somewhere in this world, Scott Baio is plowing a woman he doesn't love," - Peter Griffin, *Family Guy*
"Surely their interest would be in Microsoft not acquiring AOL and slashing Google's revenue stream by replacing the "AOL" (read Google) search service with their own."
*Retaining the Google relationship with AOL Search.
*Gaining control of AOL Instant Messenger & ICQ to strengthen GoogleTalk.
*Using the AOL brand to sell wifi service to Joe Sixpack.
*Gaining control of WinAMP to continue development for Google's own purposes or to sacrifice it to Apple with an iTunes partnership deal.
*Switching the AOL browser to the Gecko rendering engine to aid standards compliance on the web and weaken Microsoft's interests.
*DigitalCities integration.
*MapQuest integration with the GoogleMaps service.
*Gaining Moviefone...perhaps directly challenging Fandango which TimeWarner did not have the stomach to do.
Yeah, its a little bit more important than how it is being reported in the trades, me thinks.
"Right now, somewhere in this world, Scott Baio is plowing a woman he doesn't love," - Peter Griffin, *Family Guy*
Stop speculating on anything else, guys.
Because your post was not speculation??
"The problem with internet quotations is that many are not genuine" -Abraham Lincoln