AOL and MSN, or AOL and Google, whichis worse?

[ctenidae]

http://www.businessweek.com/technology/content/dec2005/tc20051207_482454.htm

Looks like an announcement is coming soon. Which way do you think it wil go, and how will it be?

Personally, I think it'll be AOL and MSN- there's a lot more in common between those two than AOL and Google, and I just don't see Google really wanting to be in teh content providing business. Of course, the fact they're in the negotiations lends the lie to that thought.

Also, AOL and MSN would be a merger of two powerful Dark Side forces, while the "good" of Google combined with the "evil" of AOL may cause a massive cosmic implosion.

 

[ski_resort_observer]

These big mergers are becoming a regular thing, nothing special crossing every business sector from airlines to telecommunications.

SBC recently bought AT&T to basically be able to have the name AT&T. I mean what regular joe has heard of SBC?

I have been with AOL for 9 years. Everyone hates it but it has worked fine for me. I now get to AOL from the back door via Firefox, works great.

AOL has been a huge stone around the neck of TW since they merged. I think it's more of TW wanting to get rid of AOL than anything else so you whoever gets it will get it at a great price. It will be interesting.

 

[Greg]

SBC recently bought AT&T to basically be able to have the name AT&T. I mean what regular joe has heard of SBC?

My father-in-law works for SBC. He said that within hours of the deal being made public, they were changing the logos on the trucks...

 

[BeanoNYC]

As a former Time Warner employee, who's stock options hang in the balance.......I just hope Time Warner's stock rises back to it's pre-aol glory.

 

[ctenidae]

Dumping AOL will be a big help for TW, no doubt. I'm just having trouble figuring out why Google would be interested at all. They haven't done any big acquisitions, and really don't seem to have an appetite for it (they've done lots of smaller ones, but nothing like AOL would be, or Skype was). The only thing I can think of that AOL has that Google might want is the ISP, and I'm pretty sure Google could cook that up on their own for a lot less.

MSN needs AOL a lot more than Google does, that's for sure, if only because Google getting AOL would be a big blow to MSN, whereas AOL only contributes about 2-3% to Googles bottom line. If I didn't know any better, I'd think Google was in it just to drive the price up for MSN.

 

[ski_resort_observer]

One company buying another company to prevent their competitors from acquiring it is nothing new. Google is a portal, AOL is an ISP and a portal, so is MSN.

AOL has been investing alot of time and money taking their search engine to a higher level. For that reason I can see Google buying AOL. MSN and AOL similar so I can see MSN buying AOL to eliminate the competition.

If MSN does buy AOL perhaps they will have some Sherman AT problems, much like ASC did when it bought Ski Ltd. They were forced by the courts to sell some resorts. High stakes here. Lots of opinions out there. A bunch of experts do not want TW to sell AOL, not just yet anyway.

Regarding their stocks, both showed nothing unusual in volume or price the past 3 days.

 

[ctenidae]

I agree, there's nothing new in the transaction, but the players are interesting.
AOL uses Google for its search engine, so the only downside for Google if MSN gets it is the loss of that revenue (about a 2% hit to Googles bottom line). AOL is an ISP, true, but I don't see Google wanting to pay that much to access that market. They could just as easily buy something smaller, or build their own, and offer free broadband access, paid for with Google ads.

I think MSN will get the deal. The only question I have on the whole thing is why Google's even bothering, and the only thing I've been able to come up with is to jack up the price.

As for recent stock movements, the speculators made their moves weeks ago when the rumblings first came out. Only question now is who gets the deal, adn how's it going to be structured? If Google gets it, they would probably pay cash ($8 billion in the bank helps a bit, and their stock's too expensive to make for a good deal structure). If MSN gets it, they could pay cash, too, but may do a cash/stock deal (more in line with their history). So, if MSN gets it, you'll want to hold TWX and get some MS shares. If Google gets it, you probably want to be holding Google shares for when AOL earnings accrete.

Just my $.02

 

[Paul]

SBC recently bought AT&T to basically be able to have the name AT&T. I mean what regular joe has heard of SBC?

My father-in-law works for SBC. He said that within hours of the deal being made public, they were changing the logos on the trucks...

I work for SBC...uh....SNE....uh...I mean AT&T.
What's your Dad-in-Law do? I'm a Design Engineer, I design WANs. I'll be getting laid-off soon, hence, the thread about possibly moving to Eastern MA. :dunce: