The game continues ...
At the moment (25th of October) Google’s stock is valued 486.6 and Yahoo 24.5 dollar. In December (2005) the Google / Yahoo share price ratio was about 10, now the ratio increased to 20.
Google’s growth is leveraged by two factors: autonomous growth and growth through takeovers. For the autonomous part, Google needs a continuous increase in human resources. The amount of lawyers alone has risen from one to hundred already.
...”We will redouble our efforts to identify and hire the most qualified candidates ... we are committed to make Google a natural home for a diverse group of the most talented people in our industry and we will continue to work towards that goal.” (Google's Annual report 2004 investor.google.com/pdf/2004_AnnualReport.pdf - the file is fully protected to copy text)
This strategy is only possible for the autonomous part. For the takeover part, the human resources come as a package deal; then the human resources are part of the firm they takeover. In this case previous competitors are to cooperate in the new organization. Like in the case of the recent acquisition of YouTube.
... YouTube received funding from Sequoia Capital in November 2005 and the service was officially launched in December 2005. Chad Hurley and Steve Chen (two of the three original founders) proceeded to become the first members of the YouTube management team and currently serve as Chief Executive Officer and Chief Technology Officer respectively. (www.youtube.com/about)
When more companies are taken over, integration will become the enabling factor for future growth. Internal competition is a continuous threat. (This is not different for countries that absorb immigrants to facilitate growth)
In the meanwhile we read: “YouTube will stay independent, really! - The video site will keep its identity after its $1.65 billion sale to Google is complete, its CEO insists, but 'a lot [needs] to be figured out.' “ ([http://money.cnn.com/2006/10/13/news/companies/] pluggedin_google.youtube.fortune/index.htm)
“How Google's Garden Grows. Its stock rally is being fueled by increasing optimism that Google will finally succeed in branching beyond search-related ads ... also successfully expand into other, more lucrative markets such as e-commerce ...“