Rumor Mill Will Google Buy Sprint
This is one of the more interesting rumors in the technology world that Google is looking to purchase a Telco company. Sprint makes sense because it is in serious trouble as a company, and is not able to retain customers well. This makes it a prime take over target, for anyone not just Google, but anyone wanting to expand his or her cell phone service.
However, TMCNet makes an interesting argument on why and why not this would be a good deal, and keeps the whole idea firmly in the hands of speculation by stating:
Recent news that Sprint is not going to work with Clearwire to build out a WiMAX network only added to the rumors I have been hearing about Google acquiring Sprint Nextel. On the surface it seems like this would be a bad move for Google but in reality the world’s leading search engine has become so much more than just a website to go to when you want to find a trinket of information… The company now needs a wireless network to allow it to grow in the mobile search and related spaces such as watching YouTube videos on the subway. Source: TMCNet
In all it makes an interesting rumor that would work well with the open handset alliance, the sharing of information between apple and Google, as well as Google’s need to grow market share to deliver what it does best, search, news and advertising. Since we know that people will give up their private phone calls to get stuff free, there might be a plausible business bit here, that until the whole thing happens or does not happen, makes for some interesting table talk around the board room.
Google in the Telco business would immediately find themselves in the 800-pound gorilla scene, as well as having to learn to negotiate a whole new level of government bureaucracy as well. It might be better just to take a majority stake, and see if they can revitalize the company without having to take the whole thing in at once. Google’s track record with acquisitions and making them pay off in terms of profit so far has not been the best, and if anything their acquisitions have cost them rather than adding to the bottom P&L statement.
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