Why I Love This Google Buyout

"You will hardly know who I am or what I mean,
But I shall be good health to you nevertheless,
And filter and fibre your blood."
-- From "Song of Myself LII," by Walt Whitman.

Google (Nasdaq: GOOG  ) has begun a long spending spree. And it shall be good health to Google's rich blood.

Following up on CEO Eric Schmidt's promise to buy at least one company every month to accelerate out of the recession, Big G just picked up visual search outfit Plink for an undisclosed (i.e., presumably very small) sum. In effect, Google just hired a couple of engineers with the proven ability to tackle a tough information-finding problem.

What Plink does is similar to the nearly magical Google Goggles application for Android smartphones: Take a picture with the phone's camera and get a list of search results based on what's in the picture. Plink focused on identifying artwork, but the founders will now fold their efforts into the Goggles team.

And Google has a tradition of putting its new hires to useful work. For example, video technology outfit On2 Technologies gave Google the power to unsnarl a nasty mess of licensing issues that has been holding back adoption of HTML5 video services. If all goes as expected, every browser will soon have a high-powered and royalty-free technology available to make the new standard work. Bad news for Adobe Systems (Nasdaq: ADBE  ) , but great for consumers and publishers of Web video.

This acquisition alone won't change how I think about Google, but the stated commitment to buy and hire more high-quality companies and people in coming months does. Google can't quite match the waist-deep coffers of Apple (Nasdaq: AAPL  ) or Microsoft (Nasdaq: MSFT  ) , but $24 billion in cash equivalents is nothing to sneeze at and this would be a good time to put some of it to work. Heck, if Schmidt runs out of small fish, he could go chasing bigger game -- Netflix (Nasdaq: NFLX  ) is a Googly soulmate that also runs on information and is worth less than $5 billion today, for example. That On2 video tech could come in handy there, too.

Now, I'm not saying that Google will buy Netflix or anything. I'm just saying, you dig?

You may hardly know what Google is buying, but the act of shopping is itself a sign of good health. What should Big G buy next? Share your thoughts in the comments below.

Fool contributor Anders Bylund owns shares in Google and Netflix, but he holds no other position in any of the companies discussed here. He lives for National Poetry Month, eleven-twelfths of the year. Microsoft is a Motley Fool Inside Value pick. Google is a Motley Fool Rule Breakers recommendation. Apple, Adobe Systems, and Netflix are Motley Fool Stock Advisor picks. Motley Fool Options has recommended a diagonal call position on Microsoft. Try any of our Foolish newsletters today, free for 30 days. You can check out Anders' holdings and a concise bio if you like, and The Motley Fool is investors writing for investors.


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  • Report this Comment On April 13, 2010, at 2:48 PM, 370bayshore wrote:

    Why would founder be selling if company for sale?

    HASTINGS REED,C.O.B.,SELLS 10,000 ON 4/8/10 OF NFLX

    NETFLIX INC: HASTINGS REED FILES TO SELL 50,000 SHARES 4/6/10

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