Originally published January 6 2006
Google to buy a five percent stake in AOL
by Mike Adams, the Health Ranger, NaturalNews Editor
Time Warner will sell a five percent stake in AOL to Google for around $1 billion. According to a New York Times report, Google will favor AOL content. This may be because Microsoft was intending to buy part of AOL.
After weeks of speculation and rumour, it looks as though media giant Time Warner is to sell a five per cent stake in AOL to Google.
According to various sources, the five year deal means that Google will remain the default search engine on the AOL service.
AOL will also sell advertising through Google's own lucrative AdWords network as well as receiving a large chunk of free advertising for itself.
The revenue from the sale will be split 20/80 between AOL and Google.
ADVERTISEMENT be a massive turnaround for the search engine which has always prided itself on the integrity of its search results and is some indication of how badly Google wanted this deal.
This undoubtedly was intended to put pressure on the Google negotiators to sign an agreement.
Indeed, Microsoft may have thought it had the deal in the bag until late of Thursday when Steve Ballmer was told that Time Warner would sign with Google.
Microsoft had apparently offered to set up a joint venture between the two companies to sell advertising targeted through search engine traffic.
For Google to lose this deal would have meant an end to an agreement which this year in 2004 accounted for 12 percent of Google's revenues.
Now, it seems Google is even more firmly entrenched as the number one online advertising destination with Microsoft a long way behind.
Meanwhile Time Warner can feel pleased with the deal.
It not only has a new revenue stream for its sales force to exploit, the $1 billion will help the bottom line and establish the worth of the AOL division at $20 billion - considerably more than the recent valuations on Wall Street.
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