Science & technology
Google sees spending $30 bn buying foreign firms
Publish Date: May 22, 2014
Google sees spending $30 bn buying foreign firms
Google said acquisitions would be a part of its overall growth strategy. PHOTO/AFP
  • mail
  • img
newvision

SAN FRANCISCO - Google told US regulators that it could spend as much as $30 billion of its offshore cash reserves on buying foreign companies or technology rights, it emerged Wednesday.

In responses to questions from the US Securities and Exchange Commission, the Internet titan said that the bulk of the money it is amassing outside the country is likely to be spent on acquisitions.

Google told regulators in a letter that "it is reasonable to forecast" that it needs from $20 billion to $30 billion of its foreign earnings to pay to companies or technology in the years ahead.

"We continue to expect substantial use of our offshore earnings for acquisitions as our global business has expanded into other product offerings like mobile devices where our competitors and business partners are no longer primarily US based multinationals," Google said in the letter, which was dated December of 2013.

Google said acquisitions would be a part of its overall growth strategy, and that the trend was for the sizes of deals to get bigger.

Silicon Valley analyst Rob Enderle of Enderle Group did not expect Google to go on an international buying binge any time soon, reasoning that the company may actually be keeping cash abroad to avoid getting slammed by taxes in the United States.

"The real reason companies retain capital overseas is not to buy startups, it is to avoid taxes," Enderle said, noting that other tech giants including Apple and Microsoft are in similar positions.

"Every company that has a multi-national position really has a problem bringing capital back here."

Last year, Google spent about $1.4 billion on more than 20 strategic deals, including the $1 billion acquisition of Israel-based Waze.

Google wrote that it tried to buy another foreign firm, which it did not name, in a deal that could have been valued between $4 billion and $5 billion.

A year earlier Google spent $12.4 billion to buy Motorola Mobility, which it is now selling to Lenovo at a fraction of that price.

Google told the SEC that about half of its revenue came from outside the US as of the end of last year.

Google also told regulators that it envisions that one day that digital ads along the lines of those seen on smartphones or tablets will begin popping up on once 'dumb' devices such as thermostats, eyewear, watches, and appliances being made smart with computer chips and Internet connections.

"We expect the definition of 'mobile' to continue to evolve as more and more 'smart' devices gain traction in the market," Google said.

"Our expectation is that users will be using our services and viewing our ads on an increasingly wide diversity of devices in the future, and thus our advertising systems are becoming increasingly device-agnostic."

AFP

RELATED STORY

Google overtakes Apple as world's top brand: survey

Android Silver to replace Google Nexus line

Google self-driving car coming around the corner


Apple, Google settle smartphone patent war

The statements, comments, or opinions expressed through the use of New Vision Online are those of their respective authors, who are solely responsible for them, and do not necessarily represent the views held by the staff and management of New Vision Online.

New Vision Online reserves the right to moderate, publish or delete a post without warning or consultation with the author.Find out why we moderate comments. For any questions please contact digital@newvision.co.ug

  • mail
  • img
blog comments powered by Disqus
Also In This Section
Apple profit hits record on
Apple's quarterly profit rocketed to a corporate record $18 billion at the end of last year on booming sales of big-screen iPhone s, especially in China....
How Microsoft Windows Azure can save your start-up time
You may have heard of Microsoft Azure, spoken about in IT circles with words such as SQL, .Net, and software-as-a-service (SaaS)....
Twitter woos users with group chat and video features
Twitter on Tuesday began rolling out new group chat and video features as it worked to ramp up use of the one-to-many messaging service....
Facebook, Instagram suffer outage but deny hacker attack
Facebook, the world's most popular social network, and its Instagram photo site were interrupted temporarily Tuesday, provoking panic, rumours of a hack, and jokes of how more than one billion users were struggling to cope....
NFL kicks off YouTube global game channel
The US National Football League on Monday kicked off a YouTube channel for games highlights, recaps and more online to viewers worldwide....
Microsoft profit dips as revenue rises
Microsoft on Monday reported that its quarterly profit dipped but revenue increased in a sign that it is adapting to lifestyles centered on mobile devices and cloud services....
Is gambling the cause of poverty amomg youth?
Yes
No
Can't Say
follow us
subscribe to our news letter