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February 1, 2008
Microsoft/Yahoo: The Other Bidder Rumor
Like a few others, I heard buzzing today about at least one other imminent Yahoo bidder, allegedly in private equity, having forced Microsoft's hand (and price). Let's just say that if that rumor was true, Microsoft's high Yahoo offer -- based on strategic considerations, not financial ones -- will pretty much close down that path.
In other words, while it would be interesting, as it would explain some of Microsoft's tactics (as well as some of the wording in its letter to Yahoo's board around having financing in place), I wouldn't expect a Yahoo bidding war now predicated on a private equity player.
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does anyone else think that this is a stupid move by MSFT, & that Google is laughing their asses off?
MSFT/YHOO stinks of HP/DEC, or HP/CPQ, or TimeWarner/AOL...it's MSFT buying a sinking online biz to go along with their own sinking online biz.
It's not a merger of for the future. Why do you think Google is focused on the wireless spectrum bidding, the Gphone, & Android ...while MSFT is wasting $$0-Billion on Yahoo?
In 2yrs, no one would've given a crap about Yahoo!
Is there anybody anywhere in the blogosphere who thinks this deal is a good move? I don't think I've seen anyone differ from the consensus that this was a bad deal.
Is there anybody ... who thinks this deal is a good move?
Let's try to make a case for it.
Many Yahoo businesses, e.g., flickr, are widely used and can be expected to throw a reliable revenue stream. They'll maybe even grow, too, as the web becomes more available to individuals with more interest in socializing.
Certainly, MSFT knows a thing or two about profiting on monop.... uhhh, "network effects" and can be expected to mount a "buttons everywhere" campaign maybe, foto editing assumes you'll be saving your best work on flickr.
Ditto all the portal business that YHOO does reasonably well.
Will it turn into a profitable couple of years before the world moves onto The Next Great Thing? Probably, unless the culture mismatch turns into a disaster, maybe even if. Will it take a long time to integrate the main pieces of this combo? Absolutely, and it's not likely to be pretty. Will it inspire some great new mashups that couldn't have been done better otherwise? That's the question to me, because I don't see how MSFT/YHOO will keep anything very useful/profitable proprietary for very long.
At work we are used to say "Oh! what if there were no google..."
Apparently this is what a majority of people who seek information from internet share among each other.
I don't think the public are going to be quite interested about the bid, about whether MS merges Yahoo with them as far they have www.google.com alive and running...
Cheers
As I commented on Jeff Pulver's blog (Is this a re-tweet? *grin*) my immediate reaction on hearing the news was to imagine GOOG getting in there as a spoiler, if only to give M$ the gears.
But then ... what's a success scenario? How could they avoid blow-back with a successful bid? or even the backlash if they managed to hive off YHOO's search capacity?
--bentrem