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Sun Microsystems is once again looking to interpret Reg FD, the rule that seeks to guarantee that everyone gets equal, timely access to corporate earnings and other news that can affect stock prices.

When it released its fiscal second-quarter results on Jan. 24, Sun (NasdaqGS:JAVA - News) posted the full release simultaneously on both its own Web site and via the press release wire service Business Wire. Sun might be the first big company to handle earnings this way, though many companies post earnings on their Web sites shortly — perhaps minutes — after releasing the report via a wire service.

"We're working with the SEC to enhance our reporting by leveraging the Internet, which a large portion of the world uses, to provide a more direct link," said Dana Lengkeek, a Sun spokeswoman.

Using Wire's Been The Custom

By longtime custom, companies have released their results initially via Business Wire, PR Newswire, Marketwire, Prime Newswire and other electronic wires that disseminate corporate news to the media and financial Web sites such as Yahoo Finance, where many investors first see the results. Most earnings come out just after the close of regular stock market trading, but the releases often spark big action right away in after-hours trading.

Sun says it continues to try to bring more fairness to the process. Sun's efforts raise some vital questions about the best way to honor the intent of Regulation Fair Disclosure in this age of electronic media, says John Coffee, a professor at Columbia Law School.

"There is no SEC requirement that a company has to use a paid wire service to put its earnings out," he said. "The only requirement is, when the company makes disclosures to some people, it has to make them universal."

That point was the crux of a controversy over Reg FD last July, when Sun at first posted its latest earnings just on its Web page and via e-mail notices, known as RSS feeds, to investors who had signed up to get such feeds. Sun and others say it was likely the first big company to release earnings in that fashion, bypassing traditional paid news wire services until about 10 minutes later.

Some criticized Sun's move as unfair, but how to best comply with Reg FD remains open to debate.

Many investors no doubt are unaware of Regulation Fair Disclosure. The Securities and Exchange Commission passed Reg FD in 2000, seeking to end selective disclosing of important information.

Sun Chief Executive Jonathan Schwartz defended the way the company released its results in July. But Sun has tweaked its policy to post the results through its own Web site and Business Wire at the same time.

The main goal of Reg FD is to ensure that all investors have a level playing field, says Neil Hershberg, senior vice president of global media for Business Wire. He says that was not the case with Sun's earnings release in July.

Some Web surfers couldn't access the Sun site for as much as six minutes after the results were posted, says Hershberg. He says the delay was probably due to a spike in traffic to the site. But six minutes is a lifetime for a fast-moving stock.

"From a technical standpoint, RSS feeds and Web postings by their very nature do not reach all investors on a simultaneous basis because of the architecture of the Internet," Hershberg said.

The disclosure process has always been in flux. Not that long ago, investors had to attend shareholder meetings or read printed reports that might come out days later to get earnings results. Real-time communication is changing things fast, says William Shepherd, an attorney with securities law firm Shepherd, Smith & Edwards in Houston.

"This is an age-old problem of who knows the information first, especially as technology grows," he said. "Whatever you do, there are always going to be complaints."

8-K The Big Requirement

Aside from earnings, the only mandate for complying with Reg FD about any other news that might affect a stock is to file an 8-K form with the SEC, says Gary Brown, an adjunct professor at Vanderbilt Law School. He also chairs the corporate department of the Baker Donelson law firm in Washington, D.C.

An 8-K filing is known as a "current report." It's supposed to disclose any relevant stock data between the required filing of the quarterly 10-Q earnings report and the annual 10-K filings to the SEC. Companies usually will provide such news via a financial news service, but they aren't required to do so.

Changes in Sun's disclosure process reflect the fact that financial reporting is just now starting to catch up with technology, Brown says.

"The real issue for Reg FD is whether you are getting broad public dissemination," he said. "First you need to satisfy the letter of the law, and then you can work toward achieving the spirit of Reg FD."

Siebel Systems, now a unit of Oracle (NasdaqGS:ORCL - News), was one of the first companies to be penalized in a Reg FD case. The SEC fined Siebel $250,000 for disclosing non-public information at an invitation-only investor conference in 2002.

Even though Timken has been hurt by the demise of Detroit’s Big Three automakers industrial demand remained strong, helping to keep the maker of bearings and steel’s head above water on Thursday.

Timken (nyse: TKR - news - people )’s shares soared 4.7%, or $1.36, to $30.23 at the close on Thursday after reporting higher fourth-quarter profits even though its results fell below Wall Street’s forecasts.

The Canton, OH-based company’s net income jumped to $48.3 million, or 50 cents per share, from $35.3 million, or 37 cents per share, in the prior year.

Earnings from continuing operations, excluding restructuring charges and other items, were 51 cents per share.

Analysts forecasted profits of 55 cents per share.

Keybanc Capital Markets analyst Mark L. Parr said that Timken’s shares rose even though it missed the Street’s expectations because the market had already discounted some fairly difficult financial expectations given the weakening of the domestic economy. “There was very little expectation in the stock heading into the earnings release,” he said. “This provided an opportunity for the stock to react positively regarding the outlook.”

James W. Griffith, Timken’s chief executive officer, said the company’s financial results for 2007 show the strength of the industrial markets. “We expect to see continued strong demand for our products and are committed to achieving improved financial performance through a combination of better execution and portfolio management,” he said.

The Street lowered Timken earnings estimates in October after the company said higher manufacturing and materials costs would pressure results.

Fourth quarter sales rose 9% to $1.3 billion, in line with Wall Street’s forecasts.

Timken’s automotive segment reported a bigger-than-expected loss because of increasing costs for raw materials and carrying inventory.

The company said it forecasted quarterly earnings for the first quarter of 70 cents to 80 cents per share before one time items and $2.75 to $2.95 for the full year. Wall Street projects earnings per share for the quarter of 73 cents and for the full year of $2.86.

Parr said that investors reacted favorably to Timken’s upbeat outlook for 2008 because it represented significant gains in earnings outlook relative to 2007. “There was concern that the consensus estimates for 2008 were overly aggressive, which was part of the weakness in the stock in front of the earnings release.”

But not only was the guidance in line with the analysts’ expectations, and higher than 2007, but the company did a good job reaffirming the conservative nature of the guidance and saying how the current guidance could be exceeded.

SKF AB, the world’s biggest maker of bearings, said fourth-quarter profit tumbled 13% because of factory closings in France and the United States and higher raw material costs. But the good news was that the company forecast demand will improve in the first quarter and said it will pay shareholders a bonus dividend after record profit and sales in 2007.

Reuters contributed to this article.

Wild Ride Ahead Of Jobs Friday

On The Move: CVS Caremark

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NEW YORK - Video-game software publisher Electronic Arts Inc. said Thursday it swung to a loss in the third quarter, hurt in part by the way it accounts for online-enabled games, but adjusted earnings met Wall Street’s expectations.

For the quarter ended Dec. 31, the world’s largest independent video-game maker posted a loss of $33 million, or 10 cents per share, compared with a profit of $160 million, or 50 cents per share, in the same period a year ago.

Adjusted earnings, excluding a change in revenue recognition and other items, were $290 million, or 90 cents per share, matching average analyst expectations as surveyed by Thomson Financial.

Revenue jumped 17 percent to $1.5 billion, from $1.28 billion. But EA said it deferred $231 million in sales of online-enabled games to future periods. If it hadn’t, its sales would have been $1.73 billion. Analysts were expecting sales of about $1.74 billion.

“Rock Band,” “Need for Speed Pro Street” and “The Simpsons Game” were among the titles fueling the quarter’s sales, EA said.

EA forecast fourth-quarter and full-year earnings below Wall Street’s expectations because of the delay of two lucrative titles, “Battlefield: Bad Company” and “Mercenaries 2: World in Flames,” until later.

Excluding acquisition charges, the effect of the deferred revenue and other items, the company expects fourth-quarter results between a loss of 3 cents and a profit of 2 cents per share, on sales of $925 million to $1.05 billion.

Analysts had predicted a fourth-quarter profit of 16 cents per share on sales of $837.9 million.

For the fiscal year, EA forecast a loss between $1.67 and $1.48 per share and adjusted earnings of 93 cents to 98 cents per share. This is at the lower end of the company’s previous forecast and below Wall Street’s expectations of $1.11 per share.

EA also said it closed the acquisitions of BioWare Corp. and Pandemic Studios in January. The $860 million deal was the largest in company’s history. The studios EA bought from Elevation Partners are known for their action, adventure and role-playing games.

EA, based in Redwood City, Calif., reported results after the close of market. EA’s shares slid 62 cents to $46.75 in after-hours electronic trading. The stock hit a 52-week low of $44.23 earlier this week.

TOKYO - Sony’s PlayStation game business stopped losing money for the first time in six quarters, helping the company to post a 25.2 percent jump in October-December profit.

Solid demand for liquid crystal display TVs and digital cameras also helped results, the Japanese electronics and entertainment company said, which brought the world Walkman portable players and “Spider-Man” movies.

Sony Corp. raised its full year forecast through March 31 only narrowly to 340 billion yen ($3.20 billion) from an earlier 330 billion yen ($3.10 billion), and kept its sales forecast unchanged at 8.980 trillion yen ($84.40 billion).

Tokyo-based Sony also cut its PlayStation 3 fiscal 2007 sales forecast to 9.5 million machines. It had previously expected to sell 11 million PS3 consoles during that period.

Sony sold 4.9 million PS3 machine during the latest quarter for a total of 10.5 million machines sold since it went on sale late 2006.

Japanese rival Nintendo Co. has already sold more than 20 million Wii machines worldwide, wooing newcomers, including women and the elderly, with “Wii Fit,” “Wii Sports” and other hit games. Microsoft Corp. has sold 17.7 million of its competing Xbox 360 consoles. Wii and PS3 went on sale about the same time, a year after the launch of the Xbox 360.

The big recovery came in its game unit, which had been losing money on launch costs for the PlayStation 3, the successor to the hit PlayStation 2.

The PlayStation 3 machine itself was still a money-loser but the losses had been trimmed and the machine was expected to start producing profit in the fiscal year starting in April.

Sony’s overall profit for the three months ended Dec. 31 climbed to 200.2 billion yen ($1.88 billion) from 159.9 billion yen the same period the previous year.

Quarterly sales gained 9.6 percent from a year earlier to 2.859 trillion yen ($26.87 billion).

Profitability at Sony’s core electronics business declined for the quarter as plunging gadget prices offset better sales for Bravia LCD TVs, Vaio personal computers and digital cameras, according to Sony.

Similarly, Japanese rival Matsushita Electric Industrial Co., which makes Panasonic brand products, also reported robust results for three months ended Dec. 31 on strong sales of appliances and digital audiovisual products.

Panasonic’s quarterly profit rose 46 percent to 115.2 billion yen ($1.08 billion), and the 4 percent drop in sales on year to 2.34 trillion yen ($22.02 billion) was due to Victor Company of Japan’s change in status from subsidiary to affiliate.

Sony’s sales and profitability in its movies division both fell because of a dearth of theater hits comparable to “Casino Royale” and “Pursuit of Happyness” of the previous year.

Equity-related income edged up 9 percent on year. Such gains reflect the performance of Sony’s cell phone joint venture Sony Ericsson Mobile Communications AB, where handset sales for the quarter soared 18 percent on year to 30.8 million cell phones.

Sony BMG Music Entertainment also fared well with best-selling albums such as Alicia Keys’ “As I Am,” Celine Dion’s “Taking Chances” and Carrie Underwood’s “Carnival Ride.”

Also boosting investment-related income was Sony’s liquid crystal display joint venture with Samsung Electronics Co.

Sony’s financial services operations, including an insurer and online bank, racked up a loss because of the recent slide in Tokyo stocks. Share prices have languished after the U.S. subprime mortgage crisis surfaced last year.

Sony shares gained 3.6 percent in Tokyo to 5,220 yen ($49.06). Earnings were announced after trading ended.

 FIVE TRADING DAYS
Dow Jones industrial average, five days
Wall Street ended a frenetic January with a huge advance Thursday after investors set aside worries about the bond market and grew more optimistic that the Federal Reserve’s interest rate cuts will indeed help lift the economy back into solid growth. The Dow Jones industrials rose more than 207 points.

The day’s trading was a microcosm of the entire month, with the Dow first falling more than 190 points, and then by late afternoon, soaring more than 250.

It capped a month that saw frequent triple-digit moves in the Dow as investors alternately anguished about the fallout from the housing and mortgage crisis and celebrated any news that indicated the damage might limited.

Still, the major indexes ended the month with heavy losses. The Fed’s 1.25 percentage points in interest rate cuts, designed to stave off a recession, ultimately gave Wall Street some reassurance that the economy might soon show signs of recovery.

According to preliminary calculations, the Dow rose 207.53 or 1.67% to 12,650.36.It’s still down more than 4.5% for the year so far.

Displaying the trademark volatility it has shown in recent months, Wall Street appeared to shrug off for the time being some concerns about the vulnerability of the financial sector amid continuing credit market problems.

MBIA Chief Executive Gary Dunton told investors in a conference call Thursday that the business of packaging debt, which has lately caused headaches for investors, will bounce back. He expects some of the products will be less exotic, and presumably easier to evaluate, according to Dow Jones Newswires.

Dunton’s comments appeared to reassure investors that despite the problems investors are having in sorting solid debt from that tainted by bad debts on mortgages, that a collapse of the bond insurance business is not necessarily in the offing.

The market’s bounce higher after a morning pullback comes a day after the Federal Reserve again lowered interest rates for the second time in little more than a week.

Still, reports on sluggish consumer activity and higher jobless claims reflected the uncertainty facing the country. Along with the insurers’ problems, they underscored to the market that the Federal Reserve’s massive interest rate cuts this month are not going to be a miracle cure for the economy’s ills.

“It seems to be a tug-of-war between ‘Is this a systemic problem?’ or ‘Is this more of a cyclical problem?’ that can be corrected with sort of the standard fare of monetary stimulus,” said Kevin Gaughan, portfolio manager and equity strategist at Wells Capital Management in Milwaukee.

Jitters about further losses for the financial sector got the better of investors overseas Thursday, keeping foreign markets under pressure and on track for their steepest monthly slide in over five years.

The FTSEurofirst 300 index of top European shares fell 1.6% with Germany’s DAX, London’s FTSE and France’s CAC all down more than 1%.

MSCI world equity index was flat but has fallen about 9% so far in January — its biggest monthly loss since late 2002.

Earlier, Japan’s Nikkei managed to squeeze out a 1.9% gain on the day but ended the month down a whopping 11.2% — its worst monthly performance in nearly 8 years.

Contributing: Reuters

Copyright 2008 Reuters Limited. To report corrections and clarifications, contact Reader Editor Brent Jones. For publication consideration in the newspaper, send comments to letters@usatoday.com. Include name, phone number, city and state for verification.

By Christopher S. Rugaber, AP Business Writer WASHINGTON — A federal appeals court on Thursday upheld TiVo’s (TIVO) claims that Dish Network (DISH) infringed on one of its patents, skyrocketing TiVo’s shares more than 28%.

The Court of Appeals for the Federal Circuit agreed with a lower court that digital video recorders distributed by Dish, formerly known as EchoStar Communications, violated software elements of TiVo’s patent.

The court overturned the lower court’s ruling that Dish infringed on the hardware elements of the patent.

But the three-judge appeals court panel said violation of the software claims was sufficient to uphold the $74 million in damages the lower court awarded TiVo. That has increased to $94 million due to interest accruals, a Dish Network spokeswoman said.

TiVo sued EchoStar Communications in 2004, alleging that the Englewood, Colo.-based satellite broadcaster infringed on TiVo’s patented technology that allows viewers to record one program while watching another. EchoStar Communications changed its name to Dish in late 2007.

TiVo, based in Alviso, Calif., pioneered digital video recorders that allow viewers to pause, rewind and fast forward live television shows.

The appeals court also said that once its ruling is final, Dish would be barred from using TiVo’s technology, which it uses on more than 3 million DVRs.

But a Dish spokeswoman said the ruling won’t interrupt service or require any action by customers, because the company already placed alternative software on its DVRs.

“This improved software is fully operational, has been automatically downloaded to current customers, and does not infringe the TiVo patent at issue in the Federal Circuit’s ruling,” Kathie Gonzales said.

TiVo welcomed the ruling, in a statement, as confirmation of the “value of TiVo’s (intellectual property) portfolio.”

In a research note, Citi analyst Tony Wible said the ruling could give TiVo “significant negotiating power” as it seeks licensing deals with cable and satellite providers that want to sell their own DVRs, using TiVo technology.

Comcast and Dish’s satellite rival, DirecTV Group already have the license to do just that.

“We would ideally like to see TiVo be the de facto standard offering for (cable) DVR boxes, where TiVo gets roughly $1 per box per month,” Wible wrote.

Copyright 2008 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed. To report corrections and clarifications, contact Reader Editor Brent Jones. For publication consideration in the newspaper, send comments to letters@usatoday.com. Include name, phone number, city and state for verification.

Can Google ever fall from its throne as the world’s top Internet company?

Thursday’s fourth-quarter earnings report may be the closest the I-giant has come thus far, and some worry that this might indicate that the U.S. economy has finally taken its toll on nearly everyone.

Although the Mountain View, Calif.-based company reported a 17% jump in quarterly profit, ravenous investors wanted more. Google (nasdaq: GOOG - news - people ) shares plunged 8.6%, or $48.46, to $515.84 in after-hours trading on Thursday.

Net income for the fourth quarter rose to $1.2 billion, or $3.79 per diluted share, from $1.0 billion, or $3.29 per diluted share, in the prior year. If it wasn’t for the stock awards given to its employees, Google said it would have made $4.43 per share, a penny below the average estimate among analysts polled by Thomson Financial.

Although Google’s profits are still rising, the fourth-quarter gain was the smallest in the company’s 14 quarters as a publicly held company. And this was just the third time Google’s earnings haven’t exceeded analyst estimates.

Sales rose 51% to $4.8 billion from $3.2 billion in the previous year.

In a more important measure to investors, Google retained $3.4 billion in revenue after paying commissions to its thousands of advertising partners across the Web.

Analysts forecasted a net income of $3.89 per diluted share on sales of $3.4 billion.

After a hiccup in the second quarter due largely to higher-than-expected hiring expenses, Google got back on track the following quarter.

The disappointment will likely amplify concerns that Google won’t be able to sell as much online advertising–the main source of its profit–as consumers clamp down on their spending amid ominous signs of a recession in the United States.

Those worries already have contributed to a nearly 20% decline in Google’s stock price this month.

But a recession should not impede Google’s growth, because nearly 50% of the company’s revenues come from outside the U.S. “The company’s international focus and the early stages of penetration in many emerging international markets lower its exposure to recession concerns in the U.S.,” Jefferies & Co. analyst Youssef Squali wrote in a recent report. (See ” Google Expected To Report Stellar Earnings”)

International sales have increased compared to domestic sales. International sales totaled $2.3 billion, 48% of the total sales in the fourth quarter, compared to 44% in the prior year. If foreign exchange rates had remained constant from the third quarter of 2007 through the fourth quarter of 2007, sales in the fourth quarter of 2007 would have been $94 million lower. If foreign exchange rates remained constant year-over-year, sales in the fourth quarter of 2007 would have been $195 million lower.

Meanwhile, Eric Schmidt, chief executive officer of Google, said he was pleased with the company’s results: “It reflects strong momentum in our core business, growing receptivity to our new business initiatives, and improved discipline in managing our operating expenses.”

The Associated Press contributed to this article.

Financials, Transports Guide Rally

On The Move: CVS Caremark

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Motorola threw Carl Icahn a bone, be he didn’t bite.

Despite announcing it was looking to spin-off or sell its handset division, corporate raider Carl Icahn told the company he was still planning to run a slate of directors for the upcoming annual meeting.

“We believe Motorola is finally moving in the right direction,” Icahn said, “but certainly still has a long way to go.”

Thursday’s announcements come a week after the Schaumburg, Ill.-based company’s shares sunk when the company disappointed investors with its weak fourth-quarter results, and showed few signs it will turn around. (See: “Motorola And Icahn Cross Signals”)

The quarter’s results were really a continuation of the company’s weak performance over the past few years, culminating in the resignation of Chief Executive Ed Zander. (See: “Zander Leaves Beleaguered Motorola”)

The disappointing performance under Zander’s tenure drew the ire of shareholders like Carl Icahn. Icahn, who owns 3.3% of the company, has criticized management’s poor guidance of the company. Icahn even unsuccessfully tried to win a seat on the company’s board to prompt change. The well-regarded asset management firm Dodge & Cox also owns 10%. (See: “Dump As Motorola Insiders Dump”)

Although the company got rid of Zander, which Icahn wanted, analysts had difficulty imagining the mogul would patiently wait 18 months for a turnaround in Motorola’s handset business.

Instead, with other profitable segments of the company growing, Wall Street insiders speculated he might agitate for a break-up, or at least pressure the board to consider such a move.

Last week JMP Securities analyst Sam Wilson said financial engineering might be on the table for Motorola, and the company could conduct surgery before that recovery comes.

“Effectively Motorola is a conglomerate,” Wilson said. “And I think selling off divisions, spinning off divisions, or breaking up the company might be a good thing. I’m not sure it would be worth more in the short term, but that’s part of the cure the patient needs–a little radical surgery.”

Zander had benefited enormously from the work that had gone into reinventing Motorola before he joined the firm as chief executive in January 2004. (See: “Reinventing Motorola”)

But two more transitions needed to be undertaken–reinventions so critical that they would ultimately define Zander’s tenure at the company.

The first was internal: In an industry that spits out new models constantly, Motorola needed a way to keep pace. That likely meant adopting a more modular approach to development–something the personal computer industry had honed.

The second transition Zander hoped to implement was fully developing a brand that is free from the entanglements of the wireless carriers. He was not able to realize that ultimately, but, as the current spectrum auction illustrates, that issue, too, may now reach a resolution.

By the end of trading on Thursday, Motorola shares close up 2.0%, or 22 cents, to $11.51.

Wild Ride Ahead Of Jobs Friday

On The Move: CVS Caremark

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SAN FRANCISCO (Reuters) - Electronic Arts Inc (ERTS.O) posted a 44 percent rise in quarterly profit excluding special items and gave forecasts below Wall Street estimates, sending shares in the world's top video-game publisher down 6 percents on Thursday.

EA said it expected fourth-quarter results to range from a loss of 3 cents per share to a profit of 2 cents per share on net revenue of between $925 million and $1.05 billion in its fourth quarter.

Excluding special items, the forecast was below the average forecast for a profit of 17 cents per share on Reuters Estimates.

For its fiscal third quarter, Electronic Arts said profit excluding special items was $290 million, or 90 cents per share, compared with $201 million, or 63 cents per share, a year earlier and one penny higher than the average Wall Street estimate.

Third-quarter net revenue was $1.5 billion, up 17 percent from a year ago, boosted by sales of titles such as "Need for Speed: Pro Street" and "FIFA 08."

EA shares fell 6 percent to $44.50 in extended Nasdaq trading. Over the past year, the stock has fallen more than 6 percent, compared with a rise of more than 50 percent for chief rival Activision Inc (ATVI.O).

(Reporting by Scott Hillis; Editing by Andre Grenon)

SAN FRANCISCO - Google Inc.’s fourth-quarter profit missed analyst expectations, signaling the crumbling U.S. economy has dented the Internet search leader’s moneymaking machine.

The Mountain View-based company said Thursday that it earned $1.21 billion, or $3.79 per share, during the final three months of 2007. That’s up 17 percent from net income of $1.03 billion, or $3.29 per share, in the same period a year earlier.

If not for stock awards given to its employees, Google said it would have made $4.43 per share — a penny below the average estimate among analysts polled by Thomson Financial.

Revenue totaled $4.83 billion, a 51 percent improvement over $3.21 billion in the previous year.

In a more important measure to investors, Google retained $3.39 billion in revenue after paying commissions to its thousands of advertising partners across the Web.

The net revenue missed analyst estimates by about $60 million, or just under 2 percent.

The disappointment will likely amplify concerns that Google won’t be able to sell as much online advertising — the main source of its profit — as consumers clamp down on their spending amid ominous signs of a recession in the United States.

Those worries already have contributed to a nearly 20 percent decline in Google’s stock price this month.

Google shares rose $16.03 to finish at $564.30 in Thursday’s regular session then plunged $45, or 8 percent, in extended trading after the fourth-quarter results came out.

Although Google’s profits are still rising, the fourth-quarter gain was the smallest in the company’s 14 quarters as a publicly held company. And this was just the third time Google’s earnings haven’t exceeded analyst estimates.

Google Chairman Eric Schmidt nevertheless said he was pleased with the company’s showing.

In addition to the U.S. economy, other issues have weighed down Google’s stock.

Investors are particularly concerned about Google’s participation in a U.S government auction of a prized piece of the airwaves that will cost the winning bidder at least $4.6 billion. The bidding isn’t expected to be completed until March.

Although Google could use the 700 megahertz spectrum to make more money from advertising delivered to mobile phones, many investors are worried the expansion could become a financial drain and distract management from the company’s main Internet business.

Google ended the year with $14.2 billion. Following through on a pledge made after its last earnings disappointment in July, Google pulled back on hiring. The company added 889 workers during 2007’s final three months after bringing in more than 2,100 employees during the June-September period.