Can life get any better for Google? Buoyed by better-than-expected third-quarter earnings, which increased 92% on $2.7 billion in revenues from its search ads, the stock briefly topped a head-spinning $500 a share in late November. Even after a measure of calm returned, the search giant's market cap stands at more than $147 billion, equal to, oh, almost nine times that of General Motors. Credit Google's triumvirate leadership of founders Sergey Brin and Larry Page and CEO Eric Schmidt, who have managed to beat back rivals from Yahoo! to Microsoft. So far, investors have been strangely trusting that Google's far-ranging initiatives will somehow all fit together.
Google's outsize ambitions did become much clearer in October, when it bought the runaway hit video site YouTube for $1.65 billion. Co-founded in February, 2005, by Chad Hurley, Steve Chen, and Jawed Karim--friends from the online payment service PayPal--YouTube has become the 14th most popular Web site. It now attracts 81 million monthly visitors to its collection of wacky amateur videos--as well as illegally posted clips from programs such as The Daily Show With Jon Stewart and The Simpsons. Equity stakes and revenue-sharing deals offered to music and television companies quieted complaints about such piracy, but Google has nevertheless set aside several hundred million dollars to fight potential lawsuits.
Still, piracy may soon be the least of Big Media's concerns. With Google's recent test of print ads with 50 big newspapers, the secret is out: Google aims to become the vortex of all modern advertising.
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