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Google Founders' Interview May Draw Fire

Raising Concerns about Quiet Period

   
11:14 pm on Aug 12, 2004 (gmt 0)

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AP [news.yahoo.com]
10:06 am on Aug 13, 2004 (gmt 0)

WebmasterWorld Administrator brett_tabke is a WebmasterWorld Top Contributor of All Time 10+ Year Member Top Contributors Of The Month



[hosted.ap.org...]

Legal questions about an interview Google Inc.'s founders gave to a magazine are the latest in a string of developments that have clouded the online search engine's highly anticipated initial stock offering.
12:00 pm on Aug 13, 2004 (gmt 0)

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My favourite quote:
"I've used Gmail for a while, and I like having the ads." -- Brin
1:19 pm on Aug 13, 2004 (gmt 0)

WebmasterWorld Administrator rogerd is a WebmasterWorld Top Contributor of All Time 10+ Year Member



I'm no big fan of investment bankers and their ilk, but Google's "we know how to do things better than the suits" approach keeps shooting them in the foot. Someone who know what he/she is doing should be on top of these guys, and it's not happening. First the miscue with the badly timed options, and now this... makes it look like there's nobody in charge.
1:34 pm on Aug 13, 2004 (gmt 0)

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Someone who know what he/she is doing should be on top of these guys, and it's not happening.

You don't think it takes someone who knows what they're doing to create a multi-billion dollar web-based business in less than 10 years?

Perhaps there timing is off a little bit, but I don't see this effecting anything all too much. Big money buys good lawyers to deal with problems such as this.

If anything, it's just going to add to the ever-growing swarm of publicity and help Google in the end.

1:39 pm on Aug 13, 2004 (gmt 0)

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I disagree with the whole premise that they should not have done the interview. Google and the founders deliberated up until the last moment if they were going to ipo or not.

The interview changes nothing. Sergy and larry are two of the most handled people in the valley. There are pointdexters with them everytime they hit the public view.

1:45 pm on Aug 13, 2004 (gmt 0)

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This is blown out of proportion. the media just loves to build things up and tear them down.

The interview was done before the quiet period even counts.

Quiet Periods are blown out of proportion as well.

It would be funny if it was playboy that actually took a bite out of google.

1:53 pm on Aug 13, 2004 (gmt 0)

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part of the article in question is at playboy.com/magazine/interview.html
(I am sure the guys will be reading *this* issue for the articles, no really! ;) )
1:58 pm on Aug 13, 2004 (gmt 0)

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If this does not delay the IPO, it will be great PR and may boost the price. Google breaking the quiet period, and in PlayBoy no less.

It may be a big mistake...or it could be a brilliantly planned and executed piece of PR. Of course it could be somewhere in between as well.

I don't think it's news that Google doesn't think highly of the way much of the stock market works today. Picture a 6 year old sticking his tounge out at peer just as the 6 year old gets his way and his peer doesn't. That's what this really is, at a more adult level.

2:09 pm on Aug 13, 2004 (gmt 0)

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(I am sure the guys will be reading *this* issue for the articles, no really! ;) )

Thinking the same thing over here :)

2:27 pm on Aug 13, 2004 (gmt 0)

WebmasterWorld Administrator rogerd is a WebmasterWorld Top Contributor of All Time 10+ Year Member



You don't think it takes someone who knows what they're doing to create a multi-billion dollar web-based business in less than 10 years?

I have the utmost respect for what they have accomplished from not only a technical but a business standpoint. In every market they have entered, they have demonstrated innovation and business savvy.

Doing an IPO, though, has a lot of obscure legal and financial requirements that only those people who spend 16 hours a day doing it really know. That's the area where they need someone in charge who isn't afraid to say "no" to the founders.

The reality is that the Playboy article won't matter one bit as far as the IPO goes - Google and its founders have had so much publicity that this is a drop in the ocean. The timing is bad, though, and it has clearly created a flurry of negative publicity and raised the specter of a flawed IPO.

3:49 pm on Aug 13, 2004 (gmt 0)

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Their attitude has soured many of the big players. The responsibility to their investors is to get as great a return as possible. Everytime they shoot another toe off, they lose dollors per share. If Im a potential stockholder (which I dont want to be at this point), I have to be concerned if they fully grasp the fiduciary responsibility they must have to their shareholders.
3:54 pm on Aug 13, 2004 (gmt 0)

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The full playboy interview has been posted on the Google IPO site:

[ipo.google.com...]

Trying to fix their mistakes again!

4:23 pm on Aug 13, 2004 (gmt 0)

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"SEC to examine Playboy for boobs" The Register
;-)
4:47 pm on Aug 13, 2004 (gmt 0)

WebmasterWorld Administrator brett_tabke is a WebmasterWorld Top Contributor of All Time 10+ Year Member Top Contributors Of The Month



[reuters.com...]

Google Inc. on Friday said its founders' interview with Playboy magazine may have violated securities rules just hours before the auction is scheduled to open on its highly watched and unusual $3.3 billion initial public offering.

But, in its amended offering document filed with the U.S. Securities and Exchange Commission, the company did not indicate whether the latest twist would delay the deal, which has been beset by concerns over market conditions and a series of recent missteps.

5:30 pm on Aug 13, 2004 (gmt 0)

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The interview has been made before the quiet period. What's all the media fuss about?

I have the feeling some people are just bored :)

5:39 pm on Aug 13, 2004 (gmt 0)

WebmasterWorld Administrator rogerd is a WebmasterWorld Top Contributor of All Time 10+ Year Member



Dirkz, part of the issue is the definition of the "quiet period" - it doesn't start precisely with the first SEC filing. It could go back as far as meetings with underwriters, etc. Also, it isn't clear that Google made any attempt to get Playboy to delay printing the article until after the IPO (once they realized that there could be a conflict).

There seems to be a good deal of judgment in how the SEC views these things. Doing a Playboy interview isn't the same as meeting with a reporter from the Forbes and saying you expect 40% annual growth for at least five years. Nevertheless, it's worth noting that the other big tech IPO in recent times, salesforce.com, was delayed due to comments made in a New York Times article.

5:52 pm on Aug 13, 2004 (gmt 0)

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I hate to say it, but if they talked to anyone about the securities of their company before the quiet period was over, then they are in violation of the quiet period rules and regulations. They may have to push the IPO back, and they only ones they can blame for this stupid mistake is themselves. Since they had always been prepped by their investment bankers, I am surprises that they allowed this to happen. Someone a sleep at the wheel.

CompWorld

6:29 pm on Aug 13, 2004 (gmt 0)

WebmasterWorld Administrator rogerd is a WebmasterWorld Top Contributor of All Time 10+ Year Member



I think it's time for some, ummm, primary research. ;) Reading the interview online is great, but serious analysis requires an understanding of the context in which the article appears... ;)
7:34 pm on Aug 13, 2004 (gmt 0)

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I see it as your duty to the other members, Rogerd...
7:37 pm on Aug 13, 2004 (gmt 0)

WebmasterWorld Senior Member 10+ Year Member



I doubt anyone was asleep at the wheel - Google has more lawyers than they know what to do with.

They knew exactly what they were doing. I can't imagine L & S meeting with playboy wouldn't be run by the lawyers.

If they have to buy back the shares at what people paid for them - it makes the shares that much more valuable.

People misunderstand the quiet period. It does not mean you have to be totally quiet.

[sec.gov...]

I don't think anything in the article was out of line.

The Quiet Period is supposed to protect investors back in the day when information on these things were spotty. The SEC themselves wanted to get rid of it in 1998.

And to make matters worse - saleforce.com took a month off from their IPO, based off of what they claimed was an Article in the New York Times, and at first blush - it seems identical to the facts of Google, but many of the media reports contain innacuracies such as the "The SEC forced" them to stop, while it was done on salesforce.com's part.

Salesforce.com had other things going on there.

The worst that will happen to them is they WILL get sued if the price goes down. Google knows this.

8:47 pm on Aug 13, 2004 (gmt 0)

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They're defending the interview loudly at this point.

"We would contest vigorously any claim that a violation of the Securities Act occurred," Google continued. "We do not believe that our involvement in the Playboy Magazine article constitutes a violation. However, if our involvement were held by a court to be in violation of the Securities Act of 1933, we could be required to repurchase the shares sold to purchasers of this offering at the original purchase price for a period of one year following the date of the violation."

Full article found here [washingtonpost.com] (May require login.)

8:59 pm on Aug 13, 2004 (gmt 0)

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"If our involvement (in the article) or such activities were held by a court to be in violation of the Securities Act, we could be required to repurchase the shares sold to purchasers in this offering at the original purchase price for a period of one year following the date of the violation," the company wrote. "We would contest vigorously any claim that a violation of the Securities Act occurred."

[thestandard.com...]

And that is what salesforce.com said. They are basically begging people to make the comparison.

11:45 pm on Aug 13, 2004 (gmt 0)

WebmasterWorld Senior Member 10+ Year Member



You don't think it takes someone who knows what they're doing to create a multi-billion dollar web-based business in less than 10 years?

They didn't create a multi-billion dollar web-based business - they created Google and got billions of dollars for it, there's a difference. They pay plenty of people to manage the business (i.e. the 'suits' they like to criticise) that makes it a multi-billion dollar business. The idea was simple and they came up with it first, if they hadn't, someone else would - their not exactly Einstein. Google has a Monopoly which other people with the same idea are finding hard to break. Do you think anyone will ever topple Microsoft now even if they create a superior software package?

I came up with an idea back in 1998 that has been copied over and over and over in the UK. Just because I made a fortune doesn't make me a genius, I was just lucky that the idea hit me first. Or are you suggesting that these two guys single-handedly led the company to its current success?

It's a searchable database, it's not really inventing the wheel. In my opinion the spammers are the ones with the higher IQ ....... well they're winning aren't they?

5:15 am on Aug 14, 2004 (gmt 0)

10+ Year Member



I hope Google's occasionally chided legal handlers got the OK from Playboy to republish that article on their ipo site. :)
11:00 am on Aug 14, 2004 (gmt 0)

10+ Year Member



>I doubt anyone was asleep at the wheel

Well I am!

11:23 am on Aug 14, 2004 (gmt 0)

WebmasterWorld Senior Member 10+ Year Member



> It's a searchable database, it's not really inventing the wheel.

Hmm. Why did they become so popular then, without any real marketing campaign? And why is altavista dead in comparison?

After all, they both have a searchable DB :)

11:27 am on Aug 14, 2004 (gmt 0)

WebmasterWorld Senior Member 10+ Year Member



I just want to know what the link for the "Girls Of Google" is.

Looks like the SEC is giving the go ahead:


was, and later today the SEC told Google lawyers that the company's actions, including publishing the interview in the amended prospectus, were sufficient, according to a person briefed on the talks. The person said the SEC had determined that the article would not be a reason for the agency to force a delay of the stock offering.

[news.com.com...]