Roger McNamee Says the Consumer Tech Will Remain King in 2003

Google's a different thing. Google's a great company. If you asked me, what's the one private company I don't have any stock that I wish I had, it's Google. Those guys are great!

For a while, I think they were confused and thought Overture was a competitor. The reality is, they do different things. Overture is really optimized for when you want to buy stuff -- it's a directory. Google is a search engine.

The Google part of the market is much bigger -- my guess is that 75% to 85% of search-engine opportunities come from Google's side. I'm sure you can make a bigger market opportunity out of searches. I've seen the numbers at Google; they are so impressive.

Google is one of the most impressive private companies ever. I have such enormous respect for these guys; what they've done there is just breathtaking. I can't wait for these guys to go public because I'm never going to get the chance to own it privately. Let me tell you, it's not for lack of trying.

After email, search is the thing people do most on the Web. And they do two kinds of search: They do searches around words and ideas, and that's what Google does. And they do searches around products, that's what Overture does.

Can Google do what Overture does? Yes. Does that make any sense given that Google's opportunity is four times as big? No. They might as well go after their market opportunity.

You saw that Yahoo!(YHOO - Cramer's Take - Stockpickr) bought Inktomi(INKT - Cramer's Take - Stockpickr), which I was a venture investor in, too. Yahoo didn't buy Inktomi because they thought that was a great opportunity. I think they did it because they're really nervous about Google. And they have a right to be nervous.

8. What is the state of the Internet these days and how will it change in 2003?

The way to think about the Web in the consumer space is to recognize that there have been three industries absolutely transformed by the Web: travel, brokerage and books/music/video retail. Those industries are fundamentally different from the way they used to be.

The travel industry has been turned on its ear. Travel agents now have to charge a fee. The airlines have completely messed themselves because they didn't understand the Web and they did some dumb things.

But there have been a bunch of guys who have done great on the Web. Think about Expedia(EXPD - Cramer's Take - Stockpickr) and Hotels.com(EXPD - Cramer's Take - Stockpickr) -- those guys have done some really great stuff, and the consumer is benefiting from a price point of view.