Comcast shows that online search is really a commodity?

Posted Mar 17th 2007 4:10PM by Tom Taulli
Filed under: Google (GOOG), Microsoft (MSFT), Comcast Cl'A' (CMCSA)

Customers of Google Inc. (NASDAQ:GOOG) definitely have some concerns. First, are they giving too much away to the search giant? Hey, perhaps search isn't that tough? And, of course, is Google getting too powerful?

I think the solution is competition -- and it looks like we are starting to see signs of this. In today's Wall Street Journal [a paid service], it looks like Comcast Corp. (NASDAQ:CMCSA) is thinking of moving from Google to its arch enemy, Microsoft (NASDAQ:MSFT).

It's really a simple matter of economics; that is, Comcast wants more money. After all, the company is the #2 provider of broadband in the U.S. And Microsoft certainly can cut a deal. It needs to show some wins, and it's many other profitable businesses make low-ball offers possible. In fact, last week, Microsoft was able to take away Google's search deal with Lenovo Group.

As for Google, it's not so good. Search is still the driving force at the company, and Wall Street has certainly put a premium valuation on it.

All in all, it's a savvy move on Microsoft's part and shows further evidence that Google is starting to show vulnerabilities.

Tom Taulli is the author of various books, including the Complete M&A Handbook and the EDGAR-Online Guide to Decoding Financial Statements.

Tags: broadband, CMCSA, Comcast, GOOG, Google, Lenovo, Microsoft, MSFT, Search

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Reader Comments (Page 1 of 1)

3-17-2007 @ 4:42PM

Rick Hanley said...

All I can say about Google is that they remind me of those guys from IT who come to your office and talk down to you because you do not know some obscure fact about a computer. And I'm not talking about the truly sharp, cool people from IT (more than 80% of those in IT), just those twits with the attitude problem. Like Google.

Get over yourself Google. Don't savor all the smoke that sell-side analysts are blowing up you ass. And I'm not talking about the truly sharp, cool people who are sell-side analysts (as many as 40% of sell-side analysts), just those twits with the ethics deficiency. Like Google.

And Boggle-the-mind-Google, don't let the sell-side analysts' lips touch your ass, you don't know what you will catch.

Separately, there is a 75% chance that if you look to the right you will see a Netflix ad. Netflix ads are to the Internet what cigarette butts are to the sidewalks and highways.