Spinning the Google-AOL deal

Spinning the Google-AOL deal: I have been somewhat perplexed by the motivations (beyond beating Yahoo or Microsoft) that led Google to invest $1 billion in AOL for a 5% stake. The “defensive” reasons didn’t hold water when considering the downside of grabbing hold of the AOL tar baby. John Battelle has a theory: It’s the chance for Google to participate in the spinning off of AOL. While this may, or may not, be correct (and let there be no mistake: I have no idea), it seems enough of a smoke screen to prevent Google shares from tanking on Monday.

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  • Scott

    I’m sure that one of Google’s motivations was to participate in a spin-off of AOL.com and its online properties.

    AOL has some real value. Yes, their search engine is valuable; although I’m not sure we have data to know how many searches are conducted through the AOL software versus the AOL website. An important detail in any spin-off would be how aggressively the AOL software unit would continue to integrate AOL search. My guess is that AOL search would be much less valuable without the AOL software supporting it.

    I see AOL Instant Messenger as having a tremendous value to a company like Google. The instant messenger market is huge, and I’m sure Google has a big interest in it.