Microsoft might get bigger - Might take over Google

Discussion in 'Lounge' started by baghdad_steve15, Oct 30, 2003.

This thread is being watched by 5 users.

    Microsoft and Google: Partners or Rivals?

    Published: October 31, 2003

    AN FRANCISCO, Oct. 30 - Wall Street is not the only one wooing Google. Microsoft is as well.

    Google, the highflying Silicon Valley Web search company, recently began holding meetings with bankers in preparation for its highly anticipated initial public offering as it was still engaged in meetings of another kind: exploring a partnership or even a merger with Microsoft.

    According to company executives and others briefed on the discussions, Microsoft - desperate to capture a slice of the popular and ad-generating search business - approached Google within the last two months to discuss options, including the possibility of a takeover.

    While the overture appears to have gained little traction - Google indicated that it preferred the initial offering route, the executives said - it demonstrates the enormous importance that Google represents as both a competitive threat to Microsoft and as Silicon Valley's latest hope for a new financial boom.

    Though seemingly spurned, Microsoft may still be interested in pursuing Google at a later date, according to an executive briefed on the discussions.

    Both Google and Microsoft executives refused to comment.

    Google, which was founded by two Stanford computer science graduate students in 1998 and quickly became one of the most popular Web sites in the world, has in recent weeks become the subject of intense speculation since it indicated to Wall Street that it hoped to sell shares of itself to the public sometime in the first half of next year.

    Google's ability to stir Silicon Valley into a frenzy has also brought back memories here of Netscape, another start-up firm whose own initial public offering in 1995 helped touch off the dot-com explosion. Netscape once threatened Microsoft with a software browser that promised to be an alternative to its overwhelmingly dominant computer operating system.

    Microsoft responded by significantly altering its business and adding its own browser as a free component of its Windows operating system, ultimately undercutting Netscape's business.

    Google recently started wheedling down a long list of investment banks it approached earlier this month about underwriting the offering, which could be worth from $15 billion to $25 billion, the executives said. The company, which maintains tens of thousands of computers to help locate information on the Web almost instantly, has also explored the idea of a so-called Dutch auction, bypassing Wall Street and selling shares directly to investors. Such an approach could give it distance from scandal-plagued investment banking deals of the dot-com era as well as create a huge base of small shareholders.

    The auction route is said to appeal to Google's founders, Sergey Brin and Larry Page, who are known for their fascination in pursing technical solutions to many different kinds of problems.

    But it appears that Google is more likely to take the traditional path of using Wall Street to sell its initial offering. It is still toying with the idea, executives said, of using an online auction for a possible secondary offering as a way to allow its millions of users to have a better opportunity to buy its shares.

    The company is considering selling about a 10 to 15 percent stake to the public, which is expected to raise more than $2 billion to be used to invest in the business and generate wealth for its employees, venture capitalists and early investors. Among the banks still competing for the business are Goldman Sachs, Morgan Stanley, Credit Suisse First Boston, Citigroup, J. P. Morgan Chase and Thomas Weisel Partners, the executives said.

    Morgan Stanley is viewed as the frontrunner, the executives said, though Google may choose two banks to lead the underwriting effort. Goldman Sachs is also viewed as a contender, the executives said, but Google's management has shown some concern about Goldman's close relationship with Microsoft and Yahoo, another major competitor.

    Google has a clearly dominant position in Internet searching, which has served as the foundation of a fast-growing and highly profitable advertising business built around placing specific text ads close to Web queries on similar subjects. Its rapid revenue growth, however, has begun attracting large competitors like Yahoo, which has acquired Overture, a leading search ad provider. While Microsoft and are both considering getting into the business, the growth in Google's Adwords keyword business has, at least for now, started to slow, according to a person with knowledge of the company's business.

    Microsoft as a search competitor could change the market's assessment of Google's value. Moreover, if Microsoft attempts to integrate Web search features directly into its coming Longhorn operating system, it could restart the bitter feud that led to the government antitrust case that grew out of Netscape's failure.

    Partly in response, Google continues to explore new businesses to extend its reach into new markets and to find new sources of revenue. One such effort included approaching Friendster, a Silicon Valley social networking company that has recently grown rapidly, according to an executive briefed on the talks. Friendster has instead received a $13 million investment from a group of venture capitalists led by Kleiner Perkins and Benchmark Capital, an action that was first disclosed in The Wall Street Journal.

    In Silicon Valley, executives and venture capitalists remain divided over the consequence of Google going public. Several people close to the two venture capital firms that are the major Google investors - Sequoia Capital and Kleiner Perkins Caufield & Byers - said that partners at the firms had been focusing closely on the timing of the Google offering, hoping to help jump-start a rebirth of the technology market of the 1990's.

    But many other venture capitalists here say that Google is such a unique company that its offering, if and when it comes, is not likely to set off a similar train of events.

    "There was a time we were all looking forward to Google," one venture capitalist said on Thursday. "But it's become such an unbelievable event that it is a juggernaut. I no longer believe that it will open up the I.P.O. market broadly."

    John Markoff reported from San Francisco; Andrew Ross Sorkin from New York.

    This is very interesting since just a few months ago Microsoft was boasting about developing a better search engine than Google. Guess they couldn't?
  2. phalkon30

    phalkon30 Jay Leno Geek


    My dad and I have allways played with the idea that google is so powerfull...what would we do without it, or what if it went pay service?
  3. MikeHunt

    MikeHunt Member

  4. Potato

    Potato poe-tay-toe Established Member

    I hope Google stays just Google. I like it the way it is.... it kicks ass. *crosses fingers*

    I tried searching the same things on google and teoma... google gave better results... (I searched my name, Potato429).
  5. MikeHunt

    MikeHunt Member

    yo potato...try 2 out of 3...LOL

    then there is Kartoo

  6. nasrules

    nasrules PeerWebmaster

    If Microsoft took over Google it would certainly be a great tragedy.

    If the worst comes to the worst, check out AlltheWeb.
  7. isus

    isus Member

    if microsoft took over google, they'd probably get smacked with another anti-trust lawsuit so fast, it would make your eyes spin.

    seriously, what other search engines do you use?

    i only use google, i never have to go anywhere else, because i can always find what i want on google.
  8. lizardsforall

    lizardsforall Final Run

    there are alternatives like teoma, but google is by far the best, no adware, indepth searches, and best of all free. If a merger does occur, it looks like i'm back to, gulp, yahoo and there 90,000 "sponsored" results that are completly irelevent.

    Anti-Trust, good movie. One thing, the main antagonist... he looks like someone I know but I can't put my finger on it...(/me rubbing hands in a devious manner)
  9. Ken17625

    Ken17625 Your best nightmare.

    If Mircosoft gets it's grubby hands on google, i'm going to go jump off a bridge.
  10. isus

    isus Member

    i just tried teoma... wow... it's weird not being at google... i typed in "northblue", in hopes that it would find my site. well, it didn't find the address, but it did find the older one,,, the one that will lead you to a dead page.

    google on the other hand, removed all the digitalrice addresses...

    these are the kind of features i like in a search engine: not being thrown to a dead page.

    no offense, but it (teoma) could use a little more work.
  11. Forest_Spirit

    Forest_Spirit "music thief"


    this is spooky...!
    ok guys i know it's halloween and everything but knock it off!
    this isn't funny!

    if microsh*t does eat up google i'm...ahm....lost?
    it's the only one i use!
    damn greedy gates! :shoot
  12. origin

    origin exploited of deleted.....

    it is quite scary MS is trying to get there hands on everything now even google, its the best search engine right now and i love it but it becomes a ms by-product then *uck it!

  13. roberto811

    roberto811 wannabee computer geek

    im sure microsoft could take over any company they wanted to because gates has like 40 bill in the pocket and microsoft is probably worth couple 100 bill
  14. txturbo930

    txturbo930 Member

    MS will Fugg it up. Stay away Mr. Bill Stay away!
  15. shawners

    shawners Hurt no more my son.

    maybe when microsoft takes over google.. Maybe they can do a google search for a security patch for all these worms.
  16. rctempire


    How crap M$ want the world now adays getting to big for their boots Hope google dont get taken over cause its brilliant so screw M$

Share This Page