The Next Microsoft
Google shares rose above $700 this week, making the search giant worth more than Cisco, Intel, Apple, or IBM, but still less than Microsoft and General Electric, if just barely. Is the company really worth that kind of money or is this just the effect of a bubble market?
Context & Ripple Effects
The $700 print caps a fast arc: Google passed Cisco as Silicon Valley's most valuable company back in June, cleared $600 a share at the start of October, and within a month has overtaken Intel, Apple and IBM by market value. Only Microsoft and General Electric still sit above it, barely.
That pace has split the commentary. Bullish pieces like Silicon Alley Insider's October call for $2,000 a share treat the climb as earnings momentum, while Cringely himself published "The Final Days of Google" in May arguing the company was past its peak — so the same columnist asking whether this is a bubble is writing against his own earlier thesis.
First-order effects
- Microsoft and General Electric are now the last two companies between Google and the top of the US market-cap ranking, turning every GOOG trading session into an implicit contest for the number-one slot.
- Cisco, Intel, IBM and Apple — the previous generation of Silicon Valley and enterprise-IT benchmarks — have been repriced below a seven-year-old search company, resetting which stock investors treat as the sector's reference point.
Second-order effects
- Rivals' valuations get judged against Google's growth multiple rather than their own historical ones, pressuring Microsoft, Intel and IBM to argue for higher-growth narratives or accept a persistent discount.
- A sustained run toward the bulls' targets invites index-fund and retail flows into GOOG that come out of large-cap peers, amplifying concentration in a handful of mega-caps.
Third-order effects
- If ad-funded search keeps capturing more of the value that hardware and enterprise software once did, the market's hierarchy shifts structurally from product companies to platform companies — with the open question being whether $700 reflects durable cash flows or a late-cycle premium that a downturn would test.
- The debate itself becomes a template: each new market leader gets measured for 'next Microsoft' status before its business model is proven through a full cycle.
The trend: Advertising-funded platforms are absorbing the market value that previously pooled around chip, PC and enterprise-IT leaders, and the speed of Google's climb is forcing Wall Street to decide whether that transfer is structural or cyclical.