The online search wars hit a feverish pitch today. In one corner, Google announced it has added 1 billion more pages to its Web index, bringing the total to 4.28 billion pages. In the other, Yahoo! says its ready to run its search engine without Google's help. Yahoo!, the first mover and industry heavyweight of the late 1990s, has been licensing Google technology since 2000 to run its search. But in the past two years, it has spent $2 billion acquiring the technology needed to compete with Google, and the two partners are splitting up.

Google is privately held and doesn't release its financials, but it's estimated to have between $700 million and $1 billion in revenue vs. Yahoo!'s reported $1.6 billion in revenue last year. So, do you Yahoo! or Google? Stay tuned. With an anticipated Google IPO in the works, the search wars will only get hotter in the coming months.

In today's Motley Fool Take:

Intel's Role Reversed

By Tim Beyers

In a remarkable turnabout, Intel(Nasdaq: INTC), pioneer of the microprocessor, confirmed Tuesday evening that it would follow rival Advanced Micro Devices(NYSE: AMD) and tune its Xeon chip for 32- and 64-bit computing.

What does that mean? Most microprocessors, like the current Xeon, can eat only 32 bits of information at a time. A 64-bit chip effectively doubles a computer's appetite. The faster a computer digests information, the faster it crunches numbers, processes online purchases, or pushes Web pages. The next generation Xeon, expected in the second quarter, will be able to handle 32 and 64 bits simultaneously -- a processing smorgasbord, if you will.

Since AMD built this capability into its Opteron chips last April, investors may be wondering why Intel remained on the sidelines.

Well, for one, 64-bit chips need software designed to send information in 64-bit chunks to take full advantage of the breakthrough. Not much of this kind of software exists today, so it's notable that Xeon is expected to run software tuned for AMD's 64-bit chips. Microsoft(Nasdaq: MSFT) will lend a hand by tuning its Windows XP and Windows Server 2003 operating systems, both of which are already designed for Opteron.

And then there's Intel's partnership with Hewlett-Packard(NYSE: HPQ). The two spent 10 years creating a pure 64-bit chip called Itanium. Intel may have thought Itanium alone would be enough. That view probably changed after IBM(NYSE: IBM) announced systems based on Opteron. Sun Microsystems(Nasdaq: SUNW), which still makes its own 64-bit processors, has followed suit, and published reports say Hewlett-Packard is also considering the chip.

What's next? Intel reiterated its support for Itanium even as it announced the new Xeon at its semi-annual conference for developers, which leaves computer makers with tough choices regarding which chip to choose. Usually, ambiguity isn't good in the computer industry.

But, as an investor, it's tough not to like Intel's response to AMD. CEO Craig Barrett came just short of declaring war on his rival, pledging to help build an "ecosystem" for Xeon. That created quick action in the industry. IBM, HP, and Unisys Corp.(NYSE: UIS) all have agreed to build systems around Xeon and Itanium. And, most importantly, Dell(Nasdaq: DELL) plans servers based on the new Xeon before year's end.

Give AMD round one, but this bout should go the distance, and Intel looks prepared to fight. You might want to grab a ringside seat.

Motley Fool contributor Tim Beyers is a tech geek but prefers his chips with salsa. He doesn't own shares of any of the companies mentioned here.

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No Great Acclaim

By Rick Aristotle Munarriz (TMF Edible)

More Mortal than Kombat, Acclaim Entertainment(Nasdaq: AKLM) wrapped up another forgettable quarter. Through the first nine months of fiscal 2004, the company lost $0.30 a share as net revenues plunged by 37%. That stings because the video game developer put out 37 titles, five more than it released during the same period the year before.

Acclaim isn't a pretty sight. It's been two years since the stock traded above $5, and you'd have to go back six years to the last time Acclaim changed hands in the double-digits. Between its heavy debt burden, bloody financials, and negative book value, Acclaim needs more than just a hit.

Then again, it's certainly not alone. Acclaim is joined in the cellar by other fallen software publishers: Eidos(Nasdaq: EIDSY) of Tomb Raider fame, Atari(Nasdaq: ATAR), and 3DO.

For all that, it's a lucrative sector when done right. Market leader Electronic Arts(Nasdaq: ERTS) and cash-rich Activision(Nasdaq: ATVI) both have been stock recommendations in the Motley Fool Stock Advisor. Other software houses like Take-Two(Nasdaq: TTWO) and THQ(Nasdaq: THQI) have seen their shares climb better than 50% over the past year.

On the console side, a persistent Microsoft(Nasdaq: MSFT) is keeping Sony's(NYSE: SNE) dominance in check, and the promise of next-generation gaming platforms and the high-margin potential of digital delivery should be enough to keep an investor tuned into the sector.

This is in no way a fading industry. Just set aside the penny stocks like Acclaim and save those quarters for the arcade. The game is still going strong for those who know how to play.

Rick may not be too encouraged by Acclaim's financials but that doesn't stop him from enjoying a game of Acclaim's All-Star Baseball with his son. He does not own any of the stocks mentioned in this story.

Discussion Board of the Day: Video & PC Games

Will Acclaim put on its game face or will it be the next to go under? What separates the winners from the losers in the field of video game publishing? Is Nintendo a fading platform? All this and more -- in the Video & PC Games discussion board. Only on

Abercrombie & Rich?

By Alyce Lomax

Abercrombie & Fitch (NYSE: ANF) handed over a mixed bag for investors on Tuesday. While fourth-quarter net sales were up -- an event many have been waiting for given the company's recent lagging sales and PR nightmares -- the company said in its conference call that it plans to up the prices on its merchandise.

The retailer reported fourth-quarter earnings of $94.3 million, or $0.96 per share, as compared to earnings of $92.8 million, or $0.93 per share, for the same quarter one year ago. The company's net sales may have risen nearly 5% to $560.4 million, but same-store sales dropped 11%, a disturbing signal considering confidence is higher than it was last year.

When Foolish co-founder Tom Gardner performed an analysis of the pros and cons facing the company last month in Retail Bust or Quick Double?, he highlighted one particular roadblock to an Abercrombie comeback in same-store sales: management's decision not to lower the prices on its apparel. Now the company's come up with a completely opposing strategy.

Intense competition for the young adult's wallet has been evident in the struggles for many youth-oriented retailers. Both Abercrombie and American Eagle Outfitters(Nasdaq: AEOS) have suffered tough times, facing the likes of Aeropostale(NYSE: ARO) and Gap(NYSE: GPS), the latter of which has the lower-priced Old Navy unit to address young shoppers on a shoestring.

When Abercrombie reported dismal third-quarter numbers, Fool LouAnn Lofton discussed concerns about the company's strategy, including the idea that maybe it's lost touch with young adults altogether, given the success of retailers like Hot Topic(Nasdaq: HOTT), Pacific Sunwear(Nasdaq: PSUN), and Urban Outfitters(Nasdaq: URBN).

Abercrombie declared a dividend for shareholders, which is the kind of thing The Motley Fool's Income Investor subscribers rejoice in, and in fact, look for in a stock. But right now, it seems another way to assuage investors who might worry that Abercrombie will lose more and more "cool points" with its customer base. (Speaking of coolness, management sees the price hike as a way to show Abercrombie's one of the "coolest" brands. Paying more can make people feel they are getting the better product, but considering recent problems, in Abercrombie's case, I don't quite buy it.)

Investors cheered the numbers this morning, with the stock recently up nearly 11%, but how long they will keep cheering remains to be seen. Higher prices may boost sales numbers in the short term, but all bets are off as to whether the kids will pay higher prices for what they've shunned for so long.

Alyce Lomax does not own shares of any of the companies mentioned.

Quote of Note

"Half this game is ninety percent mental." -- Yogi Berra

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