Professor Bainbridge suggests that a big internet portal like Yahoo or Google could easily buy a real news company because the internet companies have much higher stock valuations. Yahoo and Google have market caps of $50 billion and $60 billion respectively while Dow Jones, the publisher of the Wall Street Journal, has a market cap of only $3 billion (according to the quoted LA Times article).
Such a move would arguably be sensible because Yahoo and Google already both provide news on their websites. Why not have direct control over the source of the news?
Of course, many used to think that Amazon.com would use its massive market cap to buy a bricks and mortar bookseller (Borders was always considered the most likely opportunity), but that never happened.
I presonally do not think they will flex their super powers to purchase a newspaper. If you look around a majority of all the newspapers display the ads are connected to both Google and Yahoo. I see them getting more aggressive with advertising on online newspapers.
Posted by: Grant | April 28, 2005 at 02:35 PM