Google & AOL–The relationship deepens

AOL announced a deeper relationship with Google today, based on adding additional Google search capabilities to the AOL service. According to Silicon Valley,. better local search, more vertical search capabilities in areas like entertainment; and tools that help users refine their searches are part of the new offering.
As a part of the expansion, AOL will display Google’s paid listings in both the business listings and directories of AOL Yellow Pages.
So, AOL has 23.5 million current users. The rumor is that the major of the ad revenue is currently coming from Google text ads and that AOL Interactive Marketing is not doing particularly well selling the AOL service.
We know Google just bought Kaltix, a new, high end company focused on personalized search and search datamining across very large data sets.
What kind of revenue could Google’s soon-to-be deployed personalized search tools do when launched against AOL’s 25.5 MM members?
Plenty, as Google’s gotta know.
My prediction #1: Google deploys personalized search tools first on AOL to make the most of all this nice new targeting the new agreement enables, helping everybody make more money.
Prediction #2: Google buys a chunk of AOL, possibly the Netscape portal, maybe even the service itself. (Think about it– Why not find a cheap and stripped down company with a nice sized user base, and then purchase it and keep all the cash? Google clearly gets that model–They’re clearly trying to get into companies with expanding user bases–they tried to buy Friendster, they’re in acquisition mode, and they need critical mass and great revenue splits. And only like 10 people tops work on the Netscape portal anymore, anyway, so it’s gotta go for a song.)
Am I smoking crack? Maybe. But Google–like old ID monster–is clearly on the prowl these days. What do you think is next?