Saturday, May 06, 2006

FAST FORWARD: Microsoft's cash versus Google - May. 5, 2006

FAST FORWARD: Microsoft's cash versus Google - May. 5, 2006: "The software giant's plan to build datacenters the size of 10 Costcos, complete with electrical substations, signals a major shift in the industry's fundamental economics.
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I believe Microsoft's strategy will increasingly be to seek to outspend Google. Since Microsoft has $35 billion in cash, that may not seem too difficult. But at the end of the first quarter Google had $8.4 billion of its own. Then it raised another $2.1 billion in a secondary stock offering. It is clearly concerned about having sufficient financial resources. With each of its recent stock offerings, people have asked why Google could possibly need so much money. The answer is becoming clear."

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