1. We believe there will be at least a $1 billion offer from private equity firms to buy an Internet company. According to Capital IQ data, the largest-ever private equity purchase of an Internet company was for $572 million, when Bankrate was acquired in July 2009.
2. We think Yahoo will finally take action to sell some or all of its investments in Alibaba Group and Yahoo Japan, and may see its shares rise to about $20 in 2012.
3. We expect more Chinese Internet companies, such as Alibaba, to pursue growth outside of China. We think Alibaba will look to increase its focus on, and presence in, the U.S.
4. We expect Google to experience further legal and regulatory problems in the U.S. and around the world, and foresee the potential for over $1 billion in fines and penalties.
5. Along those lines, we don't expect Google to be able to close on its planned purchase of Motorola Mobility until mid-year at the earliest. We even think there's a small chance the company won't consummate the transaction.
6. We believe 2012 will be an important year for mobile payments, but that Google and Google Wallet won't be leading the way. Rather, we expect eBay's payments business, led by PayPal, to become much more of a force in the mobile area and bolster its presence in retail locations. We also think eBay could look to spin off its payments unit as an IPO, or even be renamed PayPal.
7. Contrary to the view of many, we don't expect 2012 to be a banner year for mobile advertising.
8. Despite concerns about growing disruptions and competition from the likes of Google, we think 2012 will be a good one for online travel companies like Expedia and Priceline, reflecting international growth aided by more stability in Europe and gains in Asia, coupled with a solid domestic economy.
9. We believe cybersecurity will become an even more important issue in 2012. We think one notable and perhaps unexpected potential beneficiary will be Akamai Technologies which is building a security business. We expect Akamai to roll out new related offerings and partnerships in 2012.
10. We think EarthLink will continue to push towards its transformation from ISP to Internet network services company and achieve related successes and recognition.
11. We believe InfoSpace will finally announce a significant M&A-related use for its considerable cash and investments.
12. We think an Internet company that completed an IPO in 2011 could be acquired in 2012, reflecting the considerable challenges of being a public company.