GOOGLE THIS

Google, the Internet search engine firm and pop culture icon, probably will hold its initial public offering this week. Since the company announced plans to go public last April, Google has had a fairly bumpy ride to its IPO.

A few short months ago, Google was basking in the love of investment firms and investors who were aching to see the firm go public. The company was fairly christened as the IPO that could bring back high-tech IPOs as a source of corporate and personal fortune. The firm is profitable. And, as everyone now knows, Google had even become a verb:

“Did you Google your blind date from the other night?”

“Yes, I Googled him.”

In the corporate world, becoming a verb is about the closest you can get to being a sure thing.

So what happened? Everywhere you looked last week, investment pundits were advising people to stay away from the Google IPO. Many of them were suggesting first-day gains of only 5% to 10% for Google's stock price — high-tech IPOs won't return to fame on such modest gains. Several of these pundits were advising investors to wait at least a few weeks before buying the stock — if they dare buy it at all.

There have been some strange allegations against Google in recent months — most notably that it illegally sold stock before its IPO. Yet, the accusers remain anonymous, and virtually all of the other negativity being generated about the Google IPO is coming from traditional investment firms that lost out on a big payday when Google chose to go public in a Dutch auction.

Still, there are some valid concerns about Google. The company is profitable but gets all revenue virtually from one source — online advertising. It's easy, then, to compare Google unfavorably with Yahoo!, an Internet search firm that has successful branched into other businesses, including the mobile industry. By comparison, Google's diversification plan seems less clear, and if anyone remembers the economic downturn not too far away in our rear-view mirror, Yahoo! had a lot of problems keeping investors happy the last few years before it began building those new revenue channels.

Whatever the outcome, telecom companies should watch Google's IPO closely. A few financial analysts focused on the telecom industry have said in the past year that telecom IPOs might be due for a comeback because telecom start-ups are finally realizing that profitability is more important than hype. Long-term vision and potential might be the third, and still sometimes overlooked, ingredient.