Google bares its teeth as giant takes bite out of Apple

Google has hit fresh all-time highs in recent weeks, and closed Friday at US$831.52, capping a nearly tenfold rise from its public offering price in 2004 of US$85. The stock is up about 17 percent so far in 2013.

Part of the explanation comes from the rise of its Android mobile operating system, at the expense of Apple. Android is free but gives Google the opportunity to deliver more services and ads to users.

“The negativity that is surrounding Apple at the moment is giving positivity to Google,” said Gartner analyst Carolina Milanesi.

Apple, which traded as high as US$700 last year, has slumped more than 35 percent and ended Friday at US$431.67.

For Google, “there's a lot going forward at the moment,” Milanesi told AFP, noting that the company is successfully “getting consumers into their ecosystem.”

Google now appears poised to beat Apple to the symbolic level of a US$1,000 share price, say some analysts.

Analysts at Jefferies said Google set a price target for Google at US$1,000, saying it has been benefiting from a wide range of services beyond its traditional Web search ads, including shopping and mobile ads.

“Google looks well positioned for growth with the number one market share in large, rapidly growing markets,” said Jefferies analyst Peter Misek, who noted that Google remains the top Internet search engine and leading advertising platform.

Android now has a 70 percent share of the smartphone market, which “ensures that Google retains a large share of the mobile search market,” said the research firm Trefis.

“Another reason that investors are excited about Google's stock is the fact that more than 50 percent of its revenues are generated from markets outside the United States,” Trefis said in a note.

“This means that Google's revenues have ample exposure to Asia, Africa and Latin America, all of which are expected to grow at an accelerated pace over the next few years.”

Analysts say a shift to the mobile Internet is positive for Google, which is also producing its own hardware, including smartphones and tablets.

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