Google & AOL

NOON -- Google (Nasdaq: GOOG) is looking for a buyout of its AOL Inc. (NYSE: AOL) stake, it emerged Wednesday. You have to wonder whether that means anything for its investment in Clearwire LLC (Nasdaq: CLWR) as well. (See TWC in '09: Job Cuts, WiMax & Wideband .)

Here's a snippet from the Associated Press that lays out the AOL situation:

    Last week, Google sent a letter to Time Warner to trigger an escape clause in the Google-AOL contract. The provision requires New York-based Time Warner to either spin off Google's holdings in an initial public offering or buy back the stake at the current market value.
Google paid $1 billion to acquire a 5 percent stake in AOL in 2006. Google wrote off $726 million of its investment for the fourth quarter 2008.

Google also wrote down its $500 million investment in Clearwire by $355 million on January 22. So could it be looking for a buyout on that, too?

Now, Clearwire and AOL are fairly different business propositions. Clearwire's promise lies in a future of wireless Internet anywhere, anytime, while AOL is still largely associated with desktop and dialup.

Still, its clear that it is going to be an uphill struggle for Clearwire to deploy WiMax in the U.S. and deliver on its mobility promise. (See Analyst: Clearwire Will Launch Nine in '09.)

So, I've asked Google spokespeople for further comment on the future of the Clearwire investment. I'll let you know what they say (if anything). — Dan Jones, Site Editor, Unstrung

mobileinsider 12/5/2012 | 4:12:25 PM
re: Google & AOL Dan. You are on to something here. Firms are running away from WiMAX related investments. At $1.5 in write downs so far, this is just the tip of the iceberg. More $ billion write downs to come which takes all air out of the WiMAX balloon. Being 3-4 years late, mobile WiMAX is DOA (LTE around the corner)

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