Part IV: Possible Scenario & Political Strategies of Google

After taking into consideration all of these points, Time Warner’s considerations of several proposals from Microsoft and a single proposal from Google alarmed me. The Business week was pointing out that Google is trying to become a rival against Microsoft, who is the emperor of the entire computer world.

At one side we have the system controller, Microsoft, and in the other case of the scales. Their technology and emergence are totally different. Of course they are both in the computer and internet services business, but the point is that Microsoft founded in 1975, and Google founded in 1998. When we take a look at their market values, Google’s rise with $120 billion market value compared to Microsoft $278 billion is very impressive.

If they become rivals, I think they already had become, because as far as I noticed, Google is supporting Fire Fox internet search bar, which means before Microsoft banned or in such a way limited its abilities on the Microsoft Internet Explorer. However, on the other hand, Microsoft is very strong compared to Google, since Microsoft is the boss, the cop, and also the innovator of the computer world. So if we witness a competition, I guess it will be very though, and we will be able to see how a giant company can act against a younger player in the market.

My thought about this deal was in a way that Google is searching a way through TV market. This is because of the unbalanced income shares between the TV advertising and the internet advertising. The total advertising spending in U.S. was estimated $300 billion to $400 billion, and only $10 billion of this was spent for online advertising. However, which exactly points out that there is an imbalance in the advertising market, researchers announced households are spending 30% of their media times on the internet. So, after a small calculation I can say that the expected income of online advertising market is around $90 billion to $120 billion, which is 9 to 12 times of the current volume.

When we see all these market imbalances and the addictions of the entire advertising market, we normally think “why is this happening?”

The advertising market is very closed in it-self. As far as I experienced in Turkey, which is one of the most profitable sectors compared to others, but really competitive, ad market is one of those markets which is hard to audit or control by the governments, so hard to tax. If you have good relations and a good network, you can quarter double or multi quarter double your advertisement effect, because there is an uncalculated advertisement type, which is the most effective one, advices in the articles. They are much more affective and nobody can find out about any money transactions in such a deal.

Ok, what about the deal, what is Google searching for? The most important point is AOL has the highest visitors daily, it is a known fact and very important. At the hidden side Google is not running after AOL and its customers, as far as we know AOL is not performing well, and Time Warner is thinking about to sell it, and the big hungry Yahoo (was big, but still famous), Microsoft had made their bids for AOL, although they are desirable deals AOL stayed in between. This is why also they can see that Google has much more to do. They just entered the Voice Talk market. As I tested it, it is better than the MSN Messenger, Skype or even Yahoo. By the way these Voice talks are competitors of all mobile phone service providers, which will also be a good economic challenge in the near future, may be in 2 years. In addition to this, Google has just started, 3 or 4 months ago, to its Google Video project. They will make it possible to search videos; they have already started to archive the videos, which is also very attractive for Warner Bros since they have a huge archive. To conclude, Google have much more to do and will not give up about AOL, as it never does.