"Web search engine Google and cable company Comcast are in discussions to buy a stake in Time Warner's America Online, two sources said, in a deal reportedly worth as much as $5 billion (£2.9 billion). An investment would set the stage for an alliance marrying Time Warner's trove of programming and Google's popular search and e-mail services with Comcast's high-speed Internet portal and experience in cable video distribution and telecommunications," reports Reuters.
Comment: The Guardian also has this story here, but the Reuters piece includes the interesting information that Google "derived about 11% of its first-half revenues from a deal with AOL". Even so, it's hard to see a good reason for Google to put billions into a declining, quasi-Internet service except to annoy Microsoft, which is also trying to do a deal. And while Microsoft clearly has cash to waste, I'd have thought Google would do better if it spent a few billions on upgrading its own services -- the ones that hundreds of millions of Web users actually value.
