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Google shares on a high due to Salesforce.com RRS feed

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  • Google's stock price surged to a new high on Tuesday after online software pioneer Salesforce.com joined the Internet search leader's efforts to lure even more businesses into the web's largest advertising network.

    Although the partnership wasn't extensive as previous media leaks had indicated, the alliance nevertheless could create more opportunities for Google to connect with thousands of potential advertisers who haven't previously tried run online marketing campaigns through the search engine's automated system.

    The arrangement calls for Salesforce.com to roll out a new version of its service so its 32,300 customers can distribute their online ads through Google.

    The new recruitment tool, coupled with a recent string of potentially revenue-boosting deals, helped propel Google shares to a new high of $US519 before backtracking to finish Tuesday's regular trading at $US518.84, a gain of $US11.77, or 2.3 percent.

    Although the bellwether Dow Jones Industrial average has repeatedly established new highs this year, Google's stock hadn't hit a new peak since November when it first traded at $US513.

    The shares are now up by more than six-fold from their August 2004 initial public offering price of $US85, leaving the company with a market value of $US162 billion less than nine years after co-founders Larry Page and Sergey Brin set up shop in a Silicon Valley garage.

    Despite its astounding rise, Google's stock had been lagging the market's major indexes through the first four months of this year. Since the end of April, though, Google shares have climbed 10 per cent as investors began to conclude that the stock might have been undervalued relative to other hot technology companies like Apple Inc., said Standard and Poor's equity analyst Scott Kessler.

    Apple shares have gained 45 per cent so far this year while Google's have increased by 13 per cent over the same period.

    Google's alliance with Salesforce.com is just one part of a much-larger effort to win over more advertisers.

    Other recent deals include the company's plans to buy DoubleClick Inc. for $US3.1 billion so it can become involved in more image-based advertising and another purchase of FeedBurner to expand its marketing reach with blogs and podcasts. Google also has been testing video ads on its YouTube.com subsidiary and other parts of its network.

    Saleforce.com's upgraded service is set up to track any customer referrals generated by Google's ads. No ads will be shown within Salesforce.com's service, which makes money by selling monthly and annual subscriptions to its applications.

    Wednesday, June 6, 2007 6:57 AM

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