The founders, Larry Page and Sergey Brin, developed the popular online search engine while at Stanford University in California. In September 1998, Google Inc opened its doors with the help of a $1m (€826,000) investment from one of the founders of Sun Microsystems.

It floated on the Nasdaq at $85 in August 2004. Less than two years on, the stock trades at more than $400 per share.

Google boasts 82m unique users per month. Revenues were $6 billion last year, up 92% on the previous year, and it turned a profit of $1.4 billion.

Its image has been dented somewhat by the advent of click fraud. This occurs when someone with no interest in buying a product clicks repeatedly on an online ad, so increasing advertisers’ bills. In a class action brought by advertisers, Google was accused of not doing enough to stop the practice and paid $90m as part of an industry settlement.

The two experts below have been selected for their skills in several investment areas. They, or the funds they manage, may hold shares in the companies or sectors discussed.

Pramit Ghose, head of investment strategy, Bloxham Stockbrokers GOOGLE must be the success story of the decade, going from zero to $6 billion (€5 billion) in revenues since building the company’s first data centre at Stanford University in 1998.

Although its share price more than quintupled since its flotation in August 2004, recent concerns over “click fraud” and intensifying competition — particularly from Microsoft, which launches a rival web ad system in June — have led to some instability in the share price.

This was compounded when Google, eBay, Amazon and Yahoo! all missed analysts’ quarterly earning estimates in early February. Another concern is the lack of guidance on quarterly sales or strategic direction. The management aims to optimise for the long term rather than trying to produce smooth earnings for each quarter, which has and will lead to volatility.

Google generates 99% of its revenues from internet advertising. However, the much- publicised practice of click fraud has led to questions over Google’s earnings.

Some analysts believe the potential impact from click fraud is overhyped, but others highlight LookSmart, a Google peer, which saw its revenues plunge 46% in 2005 after cracking down on click fraud.

Despite the increased competition from Yahoo! and MSN Search, the Google brand continues to gain market share and accounts for about 60% of global searches. Google is in the process of transforming itself from a one “click” pony.

Future strategy involves pushing beyond the $18 billion-a-year online ad market and into the $430 billion global ad market. Google now has more than 60 products, including Google Finance, Froogle, a shopping search engine, and Gmail, an e-mail product, and intends to offer more. While these new offerings may not generate high earnings, they will raise brand awareness and reduce dependency on the core business.