Google: Considering M&A After All?

Eric Schmidt has been making the rounds, it appears. The Google Inc. (NASDAQ:GOOG) chief recently sat down for a wide-ranging interview with TechCrunch, and now he's telling Japanese paper The Nikkei that the Internet search leader has "begun seriously looking at acquisitions again," particularly among venture-backed companies that are poised for growth in the cloud computing realm.

Though it has struck a few deals in the past months, including the $106.5 million purchase of video compression software developer On2 Technologies Inc. last month, Schmidt back in April had signaled that Google would be taking a step back from M&A because prices had not sunk low enough. His words echoed those of Google vice president of corporate development David Lawee a few months earlier. But apparently it's time to go shopping now, with economic conditions on an apparent upswing.

"I think the worst is behind us," Schmidt told The Nikkei. The report prompted Kara Swisher of BoomTown to look at the universe of VC-backed startups that might make a tasty target for Google or others.

Schmidt also managed to get some digs in at rival Microsoft Corp. (NASDAQ:MSFT), which has charged Google with holding an overly dominant position in the search market.

"We're much more likely to listen to criticism from a consumer ... than we are from somebody who is losing revenue because of the Internet." - Olaf de Senerpont Domis

Comments

[guliamo:]

I was quite surprised that Google are so late entering the "Cloud" business.
I wonder why they need to acquire companies to do that but I trust they know what they are doing.
Expect them to enter the market with a price slashing bang. Can't wait! :)

Sep 03 11:55 AM

[modelportfo...:]

@DJIA5000. Isn't it time for bears to hibernate? We are getting close to winter and there will soon be no food around. Seriously though, your post reminds me of the lines from Bourne Ultimatum when the lady who used to run the Paris office corrects the current team when she says that Bourne does not do random; Bourne does not make mistakes. Maybe giving Google some credit that they have developed the greatest advertizing revenue model of all times and the revenue potential keeps growing, not shrinking, as long as the world economy revives. If your point about fewer clicks were correct, why would people grow their ad budget on Google, which they are obviously doing.

So if your point is, the world is heading back to 1929 Depression, then that would be a view to discuss. To slag off Google's strategy as worse than the convicted monopolist, Microhoo undermines your credibility. How is charging zero for most of their services the evil strategy of a monopolist? Your cave beckons for winter.

Sep 03 04:34 PM