Filed under: Deals, Google (GOOG), Microsoft (MSFT), Yahoo! (YHOO), Marketing and advertising

Sheldon suggested the other day that Microsoft Corp. (NASDAQ: MSFT) should split off its web search and services arm so that it could fit better with a possible Yahoo, Inc. (NASDAQ: YHOO) combination. Instead of entertaining that notion, Microsoft still has some cash to spend to ensure, for now at least, it still has a growing presence in the web search and e-commerce arena.

To that end, the company announced this morning that it will spend $486 million to purchase Greenfield Online, Inc. (NASDAQ: SRVY) as it swiped an earlier takeover offer from the Quadrangle Group with its $15.50 per share offer. Microsoft’s offer of $17.50 per share is a 10% premium over Greenfield’s closing price this past Monday, when the offer was received without Greenfield knowing the origin. That is, until today.

Microsoft wants control of www.ciao.com, one of Europe’s leading price comparison shopping search engines. Does Microsoft really think owning a leading consumer review and price shopping search engine will bolster its Microsoft Live platform? Since it couldn’t compete in the U.S. against Google, Inc. (NASDAQ: GOOG), perhaps Microsoft is turning to international purchases as a second competitive act. Greenfield also has an “internet survey solutions” division that Microsoft will sell to an undisclosed buyer.

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Filed under: Before the bell, Analyst reports, Google (GOOG), Microsoft (MSFT), Apple Inc (AAPL), Dell (DELL), Market matters, Viacom (VIA), Federal Natl Mtge (FNM), Economic data, Marvell Technology Group (MRVL), Oil

Stock futures were lower Friday morning after Dell reported disappointing results after the close Thursday. Rising oil prices due to Gustav also weighed in on investors. This morning, some economic data on personal income and spending among others will be released. Perhaps it could give the market some positive news ahead of the three-day weekend.

Dell Inc. (NASDAQ: DELL) shares are dropping about 10% in pre-market trading after the computer maker reported a 17% drop in profit to $616 million, or 31 cents per share as margins were hurt by slashing PC prices as Dell tried to fend off competition in overseas markets. Sales rose 11% to $16.4 billion, ahead of Wall Street’s view for $15.9 billion in sales.

Staying with earnings, Marvell Technology (NASDAQ: MRVL) shares are also down — over 3% in after-hours — after it reported its results after the close Thursday. The chipmaker that supplies Apple’s iPhone and Research In Motion’s BlackBerry beat expectations but gave a conservative outlook, forecasting current quarter sales below analyst expectations.

Fannie Mae (NYSE: FNM) and Freddie Mac (NYSE: FRE) which stocks have been shooting upward the past few days. The climb in share prices follows a period of downward spiral. BusinessWeek is trying to estimate how much investors have lost in its damage report.

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Filed under: Earnings reports, Google (GOOG), Amazon.com (AMZN), Walt Disney (DIS), Best Buy (BBY), Comcast Cl’A’ (CMCSA)

It’s cool fun sometimes to look at under-$10 stocks and see if there are any worth investing in. TiVo (NASDAQ: TIVO), famous maker of digital-video-recorder technology, is currently trading under $10 a share, and it reported its Q2 numbers on Wednesday. I can’t say, though, that I’m ready to buy just yet, even though some of the stats presented in the release described a nice improvement in year-over-year comparisons.

The bottom line, in fact, improved substantially. Earnings per diluted share came in at 3 cents. Last year, TiVo saw a loss of 18 cents per diluted share. According to Earnings.com, analysts were looking for a loss of 2 cents per share during the quarter, so estimates were certainly beat.

Cash flow from operations also jumped in a very nice way. The company generated over $10 million over the last six months. During the similar time period in 2007, TiVo needed to use almost three times that amount to keep operations going. Cash flow is an important metric for investors to look at, so that was good to see.

And the earnings release talked about progress the company is making with its various deals, including stuff going on with cable entity Comcast (NASDAQ: CMCSA) and retailer Best Buy (NYSE: BBY). TiVo has been working with Google’s (NASDAQ: GOOG) YouTube to provide that platform’s content on its own offering. According to Bloomberg, TiVo also has been working with Disney (NYSE: DIS) on a movie-download initiative, as well as offering its users the ability to conveniently engage in commerce with Amazon (NASDAQ: AMZN).

All of that is pretty interesting. The stock is about in the middle of its 52-week range, so it’s not hovering around the depths of a 52-week low. The shares have done very well over the last year, rising roughly 28% as of this writing. However, going back to that Bloomberg piece, we see that the outlook isn’t too hot. The third quarter will see a loss, according to management, one that may go beyond what analysts were hoping for. That makes me a little concerned when looking at TiVo as a potential trading vehicle.

My gut tells me this could approach its 52-week high, but I am reticent to put money to work here at the moment. You’ve always got to be careful with lower-priced equities.

Disclosure: I own Disney; positions can change at any time.

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Filed under: Google (GOOG), Yahoo! (YHOO), Next big thing, Small business

This week, I had a chance to talk to Elizabeth Blair. She joined Yahoo! (NASDAQ: YHOO) in 1998 and then became the company’s vice president of business operations for the global operating group. Yes, she got a great education in the online marketing space. Interestingly enough, she also has a law degree from Harvard and even practiced M&A and securities law.

Well, Blair has leveraged her experience into an upstart venture: Brand.net. The company recently raised a $10 million Series B round. The investors include: Norwest Venture Partners and InterWest Partners.

Essentially, Brand.net is an online advertising network focusing on major customers. The platform is more than just some technology, though, as Brand.net has assembled a top-notch team of brand experts.

Of course, as seen with companies like Google (NASDAQ: GOOG), the search-based ad business has become a huge profit machine. But this is only one part of the advertising game. Of course, branding is a huge market in the ad market, so why can’t it be the same for the online world?

Certain issues still need to be worked out, such as dealing with user-generated content or finding ways to measure performance. No doubt, these are tough problems. But , if companies like Brandnet.com can find some creative solutions, it should open up another big growth opportunity in the online world.

Tom Taulli is the author of various books, including The Complete M&A Handbook and The Edgar Online Guide to Decoding Financial Statements. He also operates MergerBook.com.

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Filed under: Google (GOOG), Apple Inc (AAPL), Cisco Systems (CSCO), Intel (INTC), Research in Motion (RIMM), Options

Research in Motion (NASDAQ: RIMM) closed at $127.18 Tuesday. RIMM October option implied volatility of 53 is near its 26-week average according to Track Data, suggesting non-directional price movement.

Apple (NASDAQ: AAPL) closed at $173.64 Tuesday. AAPL October option implied volatility of 37 is below its 26-week average of 47, suggesting decreasing price movement.

Google (NASDAQ: GOOG) closed at $474.16 Tuesday. GOOG October option implied volatility of 39 is near its 26-week average, suggesting non-directional price movement.

Intel (NASDAQ: INTC) closed at $23.15 Tuesday. INTC October option implied volatility of 35 is near its 26-week average, suggesting non-directional price movement.

Cisco (NASDAQ: CSCO) closed at $24.11 Tuesday. CSCO October option implied volatility of 30 is below its 26-week average of 33, suggesting decreasing price movement.

Option Update is provided by Stock Specialist Paul Foster of theflyonthewall.com

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Filed under: Products and services, Launches, Google (GOOG)

Google, Inc. (NASDAQ: GOOG) unveiled its Ad Manager advertising management platform this week after a beta release in June. This platform allows website operators to manage advertising inventory, tracking and ROI. And the price is right — there is none — which fits into Google’s history of giving away some key products for free.

Google’s Ad Manager public release is significant because it will allow almost anyone to set up and use both direct and network-based advertising to help eliminate costs and pump up revenue — even if the ads aren’t from Google’s massively popular AdSense or AdWords program.

However, Google is making it super easy for website publishers to integrate its AdSense platform directly into its Ad Manager product. This was pretty obvious from day one as Google continues to recruit more ad customers into its universe to grow its own ad revenue. Ad revenue, still, is the biggest single component of Google’s income.

Google needs to establish its ad platform as the de facto standard on the majority of websites where ad inventory is available. If it’s successful, it could have quite a bit of growth in front of it. The problem is that Google doesn’t have the best track record in marketing its products. This one needs to be everywhere a potential advertising partner may see it. Google certainly has the cash pile to spend on selling this platform.

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Filed under: Google (GOOG), Employees

This story may sound quite strange to some people, as the perks at the Google campus have been known to be among the best in the industry, if not the best. But the blogosphere was abuzz after Valleywag reported on Sunday that Google Inc. (NASDAQ: GOOG) will be taking dinners off the menu. Not just that, but while breakfast and lunch will remain free, the rumor had it that there would also be “No more tea trolley. No more snack attack in the afternoon.”

The initial reaction to this may be, really, this is what they’re whining about? Don’t they know many Americans would love to trade with them and “worry” about such things instead of worrying about paying their mortgage or losing their jobs? Why concentrate on a story of “less riches”?

Well, one possible reason this has grabbed the attention of many after all is because of the scary signal it may give. Could this be a sign that the economic hardship has reached even tech darling Google? Are there no safe havens? And with recent concern that the dollar rally could hurt Google’s result, the ‘no dinner’ story has indeed been blown out of proportion.

And then it turned out to be mostly untrue. Dinner isn’t canceled at Google, only the cafes offering dinner have been consolidated. Still, the story put the subject of Google’s employee perks in focus. Google employees have some great perks, including the much more important daycare service, on-campus dentistry and dry cleaning service. But they also have some quite superfluous perks. It only stands to reason that at some point the company may want to cut costs and that those would be the first to go.

For now, though, Google employees feel safe about their dinners, and investors, at least from this standpoint, feel safe enough as well. What tomorrow will bring if (when?) the company matures, delivering less robust growth and shareholders demand action on costs, who knows?

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Filed under: Industry, Google (GOOG), General Electric (GE)

The Olympics were supposed to be NBC’s big profit engine for this year. The unit has been something of a disappointment to parent General Electric (NYSE: GE), but one event could have changed that.

Indeed, NBC’s ratings for its Olympic programming seem to have been outstanding and its broadcast revenues for the event may set a record for TV ad income for sports programming.

But internet revenue for NBC’s coverage may be remarkably small. According to The Wall Street Journal, “NBCOlympics.com will generate just $5.75 million in video-ad revenue from the Games, according to estimates from research firm eMarketer Inc.” Some of the disappointing numbers could come from the decision to run only a modest amount of coverage on the website, but the problem may by much greater than that.

Web video may be a bust, at least from a revenue standpoint. There is more and more evidence that points in that direction. YouTube has certainly been a huge disappointment for Google (NASDAQ: GOOG). Viacom has struggled with making big money off the online version of MTV. Video has done very little to bring extra revenue to Facebook and MySpace.

The problem with selling video commercials on the internet could be that consumers have come to expect that everything online is free. Banner ads and search ads are easy to avoid as there is nothing active or intrusive about them. Video ads often start to play whether the person online wants to see them or not. That may lead to a rejection of the experience altogether.

Making cash on web video may never work. The media companies just don’t want to admit it.

Douglas A. McIntyre is an editor at 24/7 Wall St.

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Filed under: Rants and raves, Competitive strategy, Google (GOOG), Microsoft (MSFT), Yahoo! (YHOO), Time Warner (TWX)

My very first post on bloggingstocks was Microsoft: What are you thinking about? where I ranted that Microsoft Inc. (NASDAQ: MSFT) stock was going nowhere. Over the last 29, months that is exactly what it has done. It closed yesterday at $27.62.

This is not to say it has not had it’s moments rising at one time to a 52-week high of $37.50 on a lot of hopes and prayers. Nevertheless, I felt then and do now that MSFT would be better off in pieces Micro’soft’ vs Micro’hard’ — Break it up fellas!

If Microsoft wants to compete against Google Inc. (NASDAQ: GOOG) and be a dominant player on the web, it should split out its web services as a separate company. That new company would be the right merger partner for Yahoo! (NASDAQ: YHOO). There is no reason to tie the web services business to the future of the Zune (if it has one) or the XBOX entertainment game player and other equally unrelated business.

Many in the business world have expressed similar thoughts. And those sentiments have extended to AOL which is clogging up the works at Time Warner (NYSE: TWX) and would be worth far more on its own.

In reviewing one of my early comments about Yahoo I wrote:

• YHOO: No. By any metric you choose P/E, P/S, Price to book value, price to cash flow its expensive, ROIC stinks –there is none, and no dividend. Positive notes: almost no debt, ROE is good. Profit margins are great and might be sustainable. But this is another guessing game. Soooo what about YAHOO - anybody home?

Sometimes the difficulty is not so much defining your goals but negotiating the treacherous path to get there. In the case of management at MSFT, YHOO, and AOL they may see the benefits that others see in breaking out in a new form, slashing overlapping departments and getting under performing ones off the books but they cannot make the compromises necessary about valuation to make it happen. It might be big egos, or just inertia but the best they seem to be able to muster is a tweeking of the system with what seems like dubious results in the case of all three.

Sheldon Liber is the CEO of a small private investment company and the principal for design and research at an architecture & planning firm. He writes the columns Chasing Value and Serious Money. DISCLOSURE: I own shares of TWX.

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Filed under: Deals, Consumer experience, Competitive strategy, Google (GOOG), Microsoft (MSFT), Yahoo! (YHOO), Verizon Communications (VZ)

Google’s (NASDAQ: GOOG) success over the next decade depends, to some extent, on moving its search products from PCs to the new generation of mobile devices. It will go a long way toward getting a head start on that in a deal with Verizon (NYSE: VZ).

According to The Wall Street Journal, “The deal under discussion, which would make Google the default search provider on Verizon devices and give it a share of ad revenue, is aimed at dramatically simplifying what is now a confusing set of search options for cellphone users.”

The news is not good for Microsoft (NASDAQ: MSFT) or Yahoo! (NASDAQ: YHOO). After losing the PC search battle, their next, and perhaps last, option to pick up substantial business is on mobile handsets. Because Verizon has about 70 million subscribers in the U.S., a large opportunity to gain share from Google is gone.

Deals with cellular carriers are overrated. Even if the default search engine is on a handset, users can still access any other search company through the phone’s web browser.

If PC habits carry over to the wireless world, Google has already won the new war. Few people are likely to change search preferences from device to device.

Douglas A. McIntyre is an editor at 247wallst.com.

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