Concerns Raised With AOL’s $1 billion Google Deal



Verne Kopytoff of the San Francisco Chronicle reports that not everyone is excited about AOL’s deal with Google.

Concern #1 – Selling 5% ownership may scare away potential suitor.

“…billionaire investor Carl Icahn called the plan potentially disastrous and said another company may be a more lucrative partner…in a letter to the board Monday, Icahn told directors they “may be on the verge of making a disastrous decision.” Any agreement with Google that precludes a future merger or transaction with another company would be a breach of their duty, he said.”

Concern #2 – Exactly how will Google help AOL content do better in the search result?

Google’s claiming that they’re not going to give AOL anything to too juicy…

A person familiar with Google’s search-engine policies and who requested anonymity because of confidentiality agreements, said that the company will only give AOL information that is already available to others. In the past, the person said, Google has advised other big firms, including Netflix Inc. and Yahoo Inc., to insure that their content was included in the Google search index.

But it remains to be seen exactly how much they’ll be pressured to boost AOL’s search ranking…

Andy Beal, chief executive of Fortune Interactive, an online advertising company in Raleigh, N.C., said that Google, “except for providing a few bread crumbs,” hasn’t given companies advice on how to place their Web pages higher in its search results.

Help has largely been limited to a set of guidelines posted on Google’s site that explain how Web site owners can make their pages easy for Google to find, index and rank.

“It has been sacred for them to not interfere with natural results,” Beal said. “They run the risk as they grow — because of Wall Street expectations — of having to compromise their beliefs.”