What is Google worth?

When Google was nearing its IPO the share offer price implied a valuation of about $30B for the company. Since then its market cap has skyrocketed to about $45B.

At the time I used to joke around that for $1B I could easily build a competitor to Google that had 80-90% of its capabilities. Now, with Microsoft about to launch its new search service, codenamed underdog, my assertion seems to be proved, as they spent a reported $100M and 20 months to build it.

So, does this shake your faith in Google's lofty valuation? Only time will tell.

What is clear is that online advertising has become a huge industry - about $4B per year in revenues, and growing rapidly. Interestingly, there is not a single strong competitor in the search industry outside the US (except perhaps in China, and those companies are focused primarily on Chinese-language search).

Say what you want about US competitiveness, but in this case a leading new technology is completely dominated by Americans.