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Google's Achilles Heel: Page 7 of 17

Google seems to be trying to change this by branching into a number of different areas. Most notably, Google recently announced Google Video, a pay-for-video service that would allow content owners to charge fees for Google users to watch programs on their PCs, with Google collecting a percentage of the fees for itself. Content will include prime-time and classic hits from CBS, NBA basketball games, music videos from SONY BMG, Charlie Rose interviews, as well as news and historical content from ITN.

Google Video could help Google diversify its revenue stream, something that it needs to do. But "if this catches on, it will put Google in direct competition with video-content providers like DirectTV and Comcast," said Chris Sherman, executive editor of Search Engine Watch. "And those are big players to go up against."

Google's acquisition of dMarc also is seen as an attempt to diversify its revenue stream. "The potential could be huge," said Sherman. "Remember, in the 1990s, everyone said Internet ads were a failure. Google transformed the model, and showed how it could be successful. It could do something like that in the offline world as well."

Legal Trials

Then there are Google's legal woes. Google has been hit by a number of lawsuits over the past 18 months that could mean trouble.