SEC says blogs = proper disclosure

Reading through Brian Solis’s excellent guest post over at TechCrunch about the new SEC disclosure rules reminded me that I wanted to write something about them, and would have done so if my Rogers internet connection hadn’t gone down for about five hours today (thanks a lot, Ted). I know the announcement got covered a fair bit, but I think this development is pretty ground-breaking and potentially game-changing (there’s a good overview at IR Web Report). In many ways, the SEC is really just recognizing the digital media explosion that has occurred over the past couple of years. Better late than never, I suppose.

Brian says it could (or should) mean the death of the press release. But will it? I doubt it (and so does John Furrier). That’s because the issuing of press releases happens for a whole host of reasons, apart from just the need to fulfill federal disclosure requirements, otherwise known as SEC regulation FD. Lots of companies will happily push out meaningless press releases, with no “social media” features such as links or audio/video clips, either because they are blissfully unaware of what they are missing, or because they know that lots of papers and websites will run them verbatim anyway (which they will).

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Those server farms are expensive

It’s only one sentence in a long quarterly report (the so-called 10-Q) filed with the U.S. Securities and Exchange Commission, but it says a lot about Google’s financial picture going forward (the full filing is here). The sentence says:

“The annual rate of growth in 2006 of our spending on property and equipment will be substantially greater than the annual rate of growth of our revenues.”

In other words, costs are going up and revenues — not so much. The search giant blames costs for the giant server farms that it is building (including the two or three that are under construction on the banks of the Columbia River, which the New York Times wrote about awhile back) as well as increased “cash compensation” for its employees. Apparently all those math geniuses need more than just free candy.