Right now, Google is walking the thin line between empowering its users and trying to lock them in. Making this especially hard is the fact that Google now employs over 11,000 people, most of whom have been taught that they should try to lock in their users in order to monetize the Google properties. I think that Google’s power has peaked, and that it will ebb along hitting some lower lows. When all Internet companies monetize, they are monetizing the empowerment and value they have given their users. Even though its power has peaked, Google’s cash flows will continue growing because the company is constantly developing with new ways to more effectively monetize the empowerment and value it has delivered to its users.

In the case of Yahoo, I do think that we are watching it peak. Don’t think Yahoo is now in protection mode? Try auto-forwarding all emails sent to a Yahoo account to another email address; it will now cost you $19.99 per year. I would like to short Yahoo and buy Google here, but it’s just that I think the Internet is going to keep growing so much that I don’t want to bet against Yahoo either. To read more about The Cody Report go to TheCodyReport.net.

Just as AOL peaked in terms of usability in 1999 or so but not in cash flows until 2001, the usability of MySpace has also peaked, but the value of MySpace is still going to run for another year or so. News Corp is still going to be a huge beneficiary because the time lapse between MySpace peaking and Wall Street recognizing that peak. This time lapse occurs because most analysts on Wall Street look at revenue growth and extrapolate it for years to come without question.