CNN has a great example of worthless news analysis. Stories like this with little insight or creative thinking give business writing a bad name, and strengthen the case for the many perceptive and original blogs written by people who know what they're talking about.

The worst thing about this "news" article is that there is nothing "new" there -- it just rehashes old, tired stuff. (And what's the deal with the gorilla graphic -- Google's $12 billion and 6,000 employees are nothing compared with Microsoft's $35 billion and 60,000 employees.)

Let's start with an obvious non-sequitur:

The company didn't sell the stock because it needed cash.

The article says Google sold the stock not for the cash, but because S&P 500 index funds needed the stock. Huh? Every corporation sells stock to get cash, not to supply stock certificates. Google seized the S&P opportunity when demand for shares would spike, but Google's SEC filing spells out the need for cash in clear (if open-ended) English. Google needs cash for:

General corporate purposes, including working capital and capital expenditures, and possible acquisitions of complementary businesses, technologies or other assets ...

And now for the five dumbest uses of $12 billion, according to CNN:

#5. Buy Facebook - social networking is certainly on fire, and Google's Orkut isn't hacking it outside Brazil. But spending $2 billion for college site Facebook doesn't seem like the frugal Google that we've come to know.
#4. Buy YouTube - whether or not YouTube is appropriate to augment Google Video's mission, this is not a billion-dollar company (at least not yet). It wouldn't be surprising to see YouTube get snapped up, but it wouldn't sop up much of Google's cash balance.
#3. Hire more engineers - Google doesn't need $12 billion to hire engineers, because engineers are paid out the normal operating budget. If Google *doubled* its R&D, that would cost an additional $0.5 billion annually, easily covered by Google's $2.5 billion in annual operating cash flow.
#2. Build wireless broadband - it's an intriguing idea to make an end run around big network gatekeepers like AT&T, and Google's already blazing new trails in San Francisco and Mountain View; but at an estimated $10 million per city, you don't need $12 billion bucks to blanket the 10 largest metro areas with Wi-Fi.

And the number one dumbest use for $12 billion in cash is ...

#1. Buy a cable TV company - A big cable company like Comcast would cost at least six times more than the cash Google has to spend, and there are cheaper ways to get access to customers than spending that kind of money. Google's more likely to build a marketplace for TV advertising that would involve content providers and network owners as trading parties, or maybe even a dedicated marketplace with Comcast or Tivo. But buy a cable company? Google's mission is to organize the world's information, not to own the means of distribution.

And here's a bonus asinine assessment ...

#0. Pay a dividend - let me get this straight, you're saying Google should issue new stock, diluting existing shareholders just so Google can give the cash right back to shareholders as a taxable dividend. You're damn right the stock would tank if Google pulled a boneheaded move like that. How exactly would this benefit anyone but Google's competitors and short-sellers? Who writes this stuff anyway?

Google is an information marketplace that solves difficult problems at massive scale, and the market for online services is ripe for consolidation. Any major acquisition or investment will support Google's core mission and methods, and strengthen an area that today is a strategic vulnerability for Google. It would be refreshing to see the mainstream press dig in with deeper analysis rather than superficial drivel like this CNN piece.