Microsoft still has dreams to the contrary, but Google has won the search game. With an estimated 70 percent market share worldwide and nearly $25 billion of revenue, the company has left the rest of the industry in the dust.

But what's next? Search growth is slowing, and there's not much more market share to gain. So unless Google wants to have all the sexiness of a utility, it needs to find another growth engine.

There are three possibilities, says Ken Auletta, author of the new book Googled: The End Of The World As We Know It:

• YouTube
• Mobile
• Internet-based applications (like email)

None of these businesses is as profitable as search, and Google has been trying to build all three for years.

But YouTube's new emphasis on professionally produced content has radically improved the unit's financial performance.

And as evidenced by the advertising blitz accompanying Motorola's new "Droid" phones, the mobile business is finally gaining traction.

Again, neither if these businesses currently have economics that look anything like those of the search business. But people didn't think much of search economics in the early days, either.

It's difficult to deny Google's transformative -- and disruptive -- power on many traditional businesses from newspapers to book publishing. Now a decade after its founding by two Stanford University students, Larry Page and Sergey Brin, the digital media behemoth is experiencing growing pains -- while reaching for even more.

"And they're not always well-equipped for those challenges," says our guest Ken Auletta, author of the new book "Googled: The End of the World as We Know It." Based on more than a dozen visits to the tech campus, Auletta had access to the founders, CEO Eric Schmidt and about 150 present and former employees for the book.

Challenges ahead.

Many media-industry pundits have dismissed Comcast's play for NBC as the latest foray of a deranged distribution guy (Comcast CEO Brian Roberts) obsessed with getting into the content business.

The evidence?  Roberts tried desperately to buy Disney a few years ago--over his shareholders' screams--and now he's furiously negotiating for a hobbled NBC.  All this while fellow cable-content mogul Jeff Bewkes of Time Warner is bemoaning the hard lessons his company learned when it tried to combine content and distribution into the Holy Grail of "synergy."

But Roberts isn't a madman, says Leo Hindery, managing director of private-equity firm InterMedia Partners.

Comcast's goal here...

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From All Things Digital, Oct, 26, 2009:

Verizon posted a decent third quarter this morning, besting consensus estimates. Analysts polled by Thomson Reuters had been expecting earnings of 59 cents on revenue of $27.17 billion. Excluding one-time costs, Verizon reported profits of 60 cents a share on revenue of $27.3 billion. That’s a 10 percent decline year-over-year, but still better than expected.

Wireless-subscribership gains, though they trailed AT&T’s iPhone-bolstered numbers, were impressive nonetheless. Verizon added 1.2 million wireless customers during the quarter raising its total count to 89 million. That’s not the 2 million AT&T added, but it certainly demonstrates that the absence of the iPhone from Verizon’s handset line-up isn’t holding the carrier up all that much.

Verizon also added 198,000 net new customers for FiOS Internet and 191,000 for FiOS TV service.

“Verizon continues to generate strong cash flow, which we have used in building the foundation for sustainable, long-term shareowner value,” Verizon CEO Ivan Seidenberg said in a statement. “Even through the worst of the recession, we have continued to raise our dividend and to add new customers, expand markets and grow revenues based on the power and innovation of Verizon’s wireless, broadband and global networks.”

More coverage from All Things Digital:

• Exclusive Xbox 360-Netflix Partnership Not So Exclusive Anymore
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From All Things Digital, Oct. 19, 2009:

Apple’s September quarter saw, among other things, the release of Snow Leopard, the latest upgrade to its OS X operating system andthe first public appearance of CEO Steve Jobs, who’d been on a medical leave of absence for a liver transplant. It was also the first full period since the company launched the iPhone 3GS, in late June.

No wonder it was a blowout quarter.

After market close Monday, Apple reported a fiscal fourth-quarter profit of $1.67 billion, or $1.82 a share, on revenue of $9.87 billion. That topped the estimates of analysts surveyed by Thomson Reuters, who’d expected the company to earn $1.42 a share on revenue of $9.2 billion.

The company sold 3.05 million Macs during the quarter, a 17 percent increase over last year. It sold 10.2 million iPods, eight percent decline from a year-ago quarter.

And iPhones? It sold 7.4 million of those — seven percent more than it did during the same period last year. So much for those supply-chain issues that some analysts warned might undermine iPhone sales.

“We are thrilled to have sold more Macs and iPhones than in any previous quarter,” said Steve Jobs, Apple’s CEO. “We’ve got a very strong lineup for the holiday season and some really great new products in the pipeline for 2010.” [Editor's Note: "...really great new products"--is that a euphemism for tablet?]

Apple shares, which closed at $189.86 today, are spiking as I write this. At $203.90 they’re up more than seven percent in extended trading as I write this...

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• Intel CEO Says Had No Knowledge of Trading Probe
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From The Business Insider, Oct. 19, 2009:

It's the myth that will never die.

Jim Cramer has made a career out of promoting it, as have countless other stock-picking gurus since the dawn of time.

What is this myth?

If only you "do your homework," analyze those financial statements, (and listen to such-and-such a stock-picking guru), you, too, can pick stocks well enough to beat the pros.

If there's one thing that should ring out loud and clear from the Galleon insider-trading bust it is that this is preposterous.

Stock trading is a zero-sum game. You cannot make money from trading without other people losing money.* In order to win the stock-picking game, therefore, you have to out-trade other traders.  You have to beat the other traders by enough to offset your costs of research and trading (which are deducted from your returns).  And you have to do this consistently, year after year after year.

Even without illegal inside information, your competition is intense.  The hedge funds, mutual funds, and other professional traders you are competing with have, at a minimum:

• Professional analysts and traders with decades of experience who work 20 hours a day
• Huge industry Rolodexes filled with primary contacts at companies whose stocks they trade
• Research budgets that run into tens or hundreds of millions of dollars a year
• Dozens of Wall Street brokers calling all day with every scrap of info they can dig up
• Instant access to 100% of Wall Street research and analysts from hundreds of firms
• Proprietary research services that can cost hundreds of thousands of dollars a year
• High frequency trading computers that act on any market info in milliseconds

To win the stock-picking game, you have to consistently beat folks who have all of these advantages and more...

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• The 10 Countries Most At Risk of a Meltdown
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Click "more" to see the full post.

Online analysts would like you to know that there's a great new industry growth engine revving up -- mobile ads.

For example, you can't open an analyst's report these days without immediately encountering something like this:

• We're optimistic about mobile ads!
• We're bullish on mobile ads!
• Google's Verizon deal is evidence of the huge new opportunity in mobile ads!

Sounds exciting!

Unfortunately, analysts have been saying the same thing since 1995. And mobile advertising spending is still a rounding error.

Why has mobile advertising been such a disappointment?

Goggle's back in familiar territory. The stock is trading near $500 a share, nearly doubling since plummeting with the rest of the market last December.

As you'd expect, the comeback is built on the resurgence of its search business. Colin Gillis, an analyst with Brigantine Advisors, writes in his latest research report: "The key metric for us is rising CPC (cost-per-click) showing a willingness for advertisers to pay more to reach consumers -- and an indication that clicks are translating into sales … . A combination of paid click growth and a lift in CPC is the formula that drives upside in revenue and the GOOG share price."

Speaking of share price, Gillis has a $600 price target and a buy rating on the stock.

But as Henry Blodget points out in the accompanying clip, if Google wants to grow in the next decade as fast as it did in the last, the company must find its next multibillion-dollar business.

Is the mobile platform Android the answer?

From The Business Insider, Oct. 5, 2009:

Now that the Dow has been above 9,000 for several months, it’s time to start wondering about whether we’ll see the return of the curse of Dow 10,000 this fall.

The idea of the “Curse of 10,000” was much talked about earlier this decade. The market seemed to have developed a pattern—whenever the Dow reached the 10,000 level it eventually ran out of steam. After the Dow first reached the 10,000 level in 1999, it reached that level 18 more times in the next four years—only to succumb to a bear market and fall below it ever time.  The Wall Street Journal ran a famous story about the mysterious curse of this big, round number.

The pivotal change seems to have come in 2004, when the Dow hovered around 10,000 for the entire year. It was something of a break-through. The following year, the Dow sustained itself above 10,000 and never looked back.

A lot of short sellers and chart traders got hurt by the lifting of the curse of 10,000. They were accustomed to being able to reliably bet on a pull back whenever the market exceeded the 10,000 level—just as traders from the prior generation had profited from making similar bets against Dow 1,000 in the 1960s.

But a year ago the market crashed, bringing us back down below Dow 10,000.  The market seemed bent on testing the curse once more, climbing above 9,000 midsummer and refusing to dip lower. To some the pull-back in recent weeks is an indicator that the market could turn seriously bearish if Dow 10,000 is breach again.

This kind of talk sounds odd to some rationalists. It seemingly makes no rational sense that a big round number like that should be a barrier. Under some versions of the efficient capital markets hypothesis, investor psychology should be irrelevant and prices should only reflect the relevant information about the equities being traded.  The overall level of the Dow shouldn’t matter—and an arbitrarily round number of a selective index really shouldn’t matter...

More coverage from The Business Insider:

• How the Trendiest Economists Got Their Prized Discovery Terribly Wrong
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Click "more" to see the rest of the post.

From The Business Insider, Oct. 2, 2009: 

Paul Krugman observes what the market noticed yesterday, which is that enthusiasm about the recovery has blown way past the reality.

Specifically, he's worried about unemployment:

[T]he administration’s own economic projection -- a projection that takes into account the extra jobs the administration says its policies will create -- is that the unemployment rate, which was below 5 percent just two years ago, will average 9.8 percent in 2010, 8.6 percent in 2011, and 7.7 percent in 2012.

This should not be considered an acceptable outlook. For one thing, it implies an enormous amount of suffering over the next few years. Moreover, unemployment that remains that high, that long, will cast long shadows over America’s future.

Then there's the "output gap," however you define it, which Krugman puts at $2 trillion below where we could be.  (He doesn't address the role of debt in this -- a beef lots of folks have with him. Specifically, is it fair to trend potential output upward from the peak when the peak was caused by a massive and unsustainable overload of debt?)

Krugman's answer, as usual, is spending.  Yes, this will make the government finances look even worse.  But it's better over the long-term, it's better over the short-term, and it's better than the alternative.

Read Krugman's full NYT column.

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• Sorry, Paul Krugman, the Stimulus Is Crowding Out Private Investment
• The New York Times Business Section Goes to War Against Paul Krugman Over Banker Pay