Google (NASDAQ: GOOG) will allow people mentioned in Google news stories to post comments about the content. The reactions will be posted next to the content. Google News includes 4,500 English-language news sources.

According to The Wall Street Journal: "One key issue concerns who Google allows to comment on a given story and how it authenticates their identities."

Allowing sources for news stories and reporters to comment on articles seems like a fairly good idea at first blush, but on second thought is is probably an awful idea. Google says it will try to check the identifies of sources, but for tens of thousands of stories each day from 4,500 news organizations, that would appear to be as hard as searching for pirated content on YouTube. In other words, it can't be done.

Google's news response mechanism is likely to take on all of the bad aspects of message boards with people who have old agendas leaving anonymous comments that may be false or inflammatory. The idea is very different from letters to the editor sections where a very few responses can be checked accurately.

It sounds like a train wreck in the making.

Douglas A. McIntyre is a partner at 24/7 Wall St. He was editor-in-chief and publisher of Financial World Magazine.

Google (GOOG) news allows subjects to talk back originally appeared on BloggingStocks on Thu, 09 Aug 2007 07:40:00 EST. Please see our terms for use of feeds.

Since General Electric Co. (NYSE: GE) and Pearson Plc. (NYSE: PSO) face daunting odds in trying to challenge Rupert Murdoch's $5 billion bid for Dow Jones & Co. (NYSE: DJ), why are so many leakers trying to keep this story alive?

The Wall Street Journal reports that the two companies are talking -- and it's nothing more than that -- about bidding for the New York-based media company. They would combine CNBC, Pearson's Financial Times and Dow Jones into a privately held joint venture that would be controlled by both companies with a minority stake held by the Bancrofts.

Dow Jones' controlling family would be able to sell their stakes in the company if they want or convert their Dow Jones stock into the new company avoiding a big capital gains tax. The paper said that the Bancrofts would even be willing to accept a LOWER bid than the $60 per share offered by Murdoch's News Corp (NYSE: NWS) to protect the Journal's integrity.

As I've argued before, the Bancrofts professed love for the Journal is a bit hard to believe. Maybe some faction of the family is trying to keep the media's hope that someone may thwart Murdoch's plans to buy Dow Jones to squeeze more money out of the Australian tycoon. That may explain why all of these stories are caveated with phrases such as "long shot."

I would go even farther say that the odds of a competing bid emerging for Murdoch for Dow Jones are slim to none. Chances of GE and Pearson buying the company are even lower. Even if the companies bid, Murdoch would raise his insane offer high enough to deter any rational buyer.

A GE-Pearson bid for Dow Jones makes no sense financially.

As The Journal points out, if the Bancrofts kept a 15 percent in the new company, General Electric and Pearson would have to come up with $4.25 billion in cash, most of which would probably have to come up debt and cash contributions from the U.K. publisher.

Moreover, this would be a bear to manage. Running a news operation is like herding cats on a good day. Running three organizations (CNBC, The Journal and the FT)) each competing for the same audience and the same stories would be Byzantine in complexity. There also would be epic bureaucratic turf wars since both companies would have equal say in managing the company. I suspect allowing the Bancrofts to continue to have a say the venture's affairs would create an additional set of headaches.

Since it's obvious that the GE-Pearson deal won't happen, why are people still trying to talk it up? My hunch is that the chatter is coming from across the Atlantic. Pearson is under pressure from its shareholders to dump the FT and focus on higher-growth businesses such as textbooks. General Electric would probably be keen on the idea of having Dow Jones as a buffer against the nascent Fox Business Channel.

Regardless, Dow Jones is just a business to both companies. For Murdoch, it's an object of lust. At the end of the day, emotion will trump logic.

If GE-Pearson bid for Dow Jones is a longshot, why the chatter? originally appeared on BloggingStocks on Mon, 18 Jun 2007 12:27:00 EST. Please see our terms for use of feeds.