Two weeks ago, a mobile industry veteran declared that the mobile Web as dead, and now this week, BusinessWeek is arguing the exact opposite—that the mobile Internet and not Microsoft (NSDQ: MSFT) or Yahoo! (NSDQ: YHOO) is a real threat to Google (NSDQ: GOOG). The logic: Since phone’s have smaller screens, there’s less real estate to display ads, shrinking the search giant’s overall ad inventory. For example, Google can fit about 10 ads on a standard computer screen, whereas a cell phone can only fit one or two. “Imagine the horror that would befall your business if a large slice of what you sell suddenly disappeared,” the story goes.

But isn’t this logic flawed? People don’t search from a mobile phone instead of a PC, they are searching on a phone in addition to the PC. Google’s inventory should actually increase, albeit by one or two ads at a time. That’s because people’s behaviors are different when searching at home vs. when they are on the go. Generally speaking, on the phone, people want relevant, local information, like directions or restaurant recommendations. Whereas, at home, people can sift through millions of results to research something. Google is already accommodating these differences. For example, when searching Google’s mobile search page for Volkswagen, they refer you to the nearest dealership. From Google’s PC search, you get Volkswagen’s home page and the third link is to Wikipedia. Google’s likely less scared of its inventory shrinking and more afraid that it won’t be as dominant on the mobile phone as it is on the PC.