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Microsoft Eyeing AOL?
meriksen writes "This article on the CNN website suggests that Microsoft is looking to acquire AOL. What are the chances and do /. readers think this will ever happen?" The NY Post story is slightly more informative.
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Besides having to sell over Netscape (I think I have $10 here...) wouldn't there be a problem with Microsoft's existing deals with Comcast?
Well, when they deny like that, what additional proof does anyone need that this is pretty much a done deal?
A feeling of having made the same mistake before: Deja Foobar
AOL is an albatross... Steve Case has been managing an incredibly corrupt firm.
In addition, I think that a merger of this type would have extreme trouble getting through the SEC. This has "monopoly suit" written all over it.
... hi bingo
Unfortunately, this makes excellent sense for Microsoft. When they put together MSN around 1994, it was obvious that they were trying to get in on this action. MSN never succeeded in terms of its weak user base.
Microsoft already has the cash on hand, and AOL Time Warner stock has dropped about 75% since the merger was completed.
This suggests that they're only trying to acquire AOL, not AOL Time Warner - so this wouldn't be the complete media content delivery yadda yadda that they want. However, AOL has a large subscriber base and serves as an awesome potential outlet for Microsoft's content.
But is it a scary thought? Oh hell yes.
-m.
And if this deal goes down, you can thank the millions of dollars thrown around in back rooms. I can't believe this would ever even be thought of by MS, but they've got some huge balls. The operating system monopoly with the Internet service provider monopoly? (I know there are other ways of getting on the Internet and so do you, but does Billy Ray and Sheila down in Podunk? Besides, 35 million subscribers is not a drop in the bucket, either) Sheesh.... Do you need any more proof that this is a Bad Idea (tm)?
America Online acquired Netscape Communications $4.2 billion dollars in 1998 ...
And that $4.2 billion dollars has might as well be written off as entirely lost. Netscape Navigator is more or less a trivia entry in the browser wars, handing off the MS-fighting role to its child named Mozilla. Netscape's now mostly being used as a content portal...
Netscape could fold from the browser business and it wouldn't give a monopoly to Microsoft anymore.
could be very very bad... Say goodbye to AIM!
Microsoft's not that stupid. They'd likely shutter the MSN Messenger operation and transition its userbase over to AIM.
AOL has always been a bigger name than MSN. I highly doubt Microsoft would aquire such a brand image then not use it.
That's because you only watch American television. Try getting some news from more internationally-based sources (like the BBC), and you will see just how biased the American media actually is.
It's not that they taint the truth they are reporting, but they just seem to leave out the other side of the story a little too often..
When I formerly worked with Sprint, and MCI was trying to buy them, it was a God-send that it got blocked. It may prove to be the case here as well. We've already read stories on here about the EU not being Microsoft friendly.
In the end, would it benefit the consumer? I'd be inclined to say, "Maybe, but probably not". The only benefit to M$ shareholders is rolling in the monthly subscriber fees. However, they are from a fickle market: consumers. M$ gets their monthly royalties from a reliable, steady source: businesses. This is part of the reason Nextel kicks everyone's ass in terms of revenue per user (because they identified this marketing trend early and targeted it).
John
(1)Why would Microsoft, who has a failing ISP, want to buy AOL, who is a failing ISP? (2)AOL are in competition with Microsoft.
1) for millions AOL is the internet. and with millions of new subscibers, they direct HUGE traffic towards their sites. remember the smart tags in office. think AOL keywords. bingo.
2) and, you buy them. ain't like microsoft has never done this before.
remember, they are no longer, if they ever were, an innovation company. they have a US market share at which the only direction is down. their foreign share is tenuous at best with the rise of linux and gov't's, etc., becoming increasingly wary of microsoft. the biggest part fo their angst regarding linux is they can't buy it. they can't stop it. and they're not happy. aol just solidifes their hold on US market.
My problem? I was perfectly gruntled, until some numbnuts came by and dissed me.
Don't forget AIM and ICQ. With this deal MS would control all 3 client bases. The move to interoperability could be nice, but at the same time yahoo and whoever else are left out in the cold, and this provides a HUGE userbase for MS in the instant messageing arena.
A mass exodus to Apple or Linux. That's what I'd do for my organization, and I have the power to make it happen. I wonder if Microsoft knows how close some of us are to switching like that? Their credibility is hanging by a thread, and the only thing keeping us from dumping them is how many products of theirs we use and the costs associated with retraining. There are those of us that can make the case to managers that will listen. Once the dollars add up, people are quick to change.
We keep hearing, almost daily, that such and such company is moving to Apple, or that some country's government across the big pond is moving to Linux. It almost seems like the house of cards is beginning to fall. Albeit, slowly, but here and there, it's starting.
Qualitas edurus commercium, nullus penitus net rimor, nullus deus beneficium
This is idle speculation and it is completely unrealistic for all of the antitrust reasons.
1. AOL has the option to buy a large chunk on Google and Google is AOL's preferred search option. AOL promotes Google in their commercials.
It is no secret Microsoft wishes to bury Google with Longhorn.
2. AOL owns WinAmp.
Microsoft getting its grubby hands on WinAmp and other Nullsoft properties wouldn't be allowed. See the European Union's (non Mad Cow) beef with Microsoft and Windows Media Player.
3. AOL owns AIM and ICQ.
Microsoft acquiring either or both of these Instant Messenger platforms would not be permitted. AIM is essentially the standard IM client on mobile phones in America. AIM is also the basis for Apple's iChat software. There are too many parties involved that would object to this.
4. AOL has options to buy Amazon.com stock and owns shares.
'Nuff said.
5. AOL owns shares in TiVo and is a partner.
'Nuff said. See UltimateTV. Also see "WindowsXP Media Center."
6. AOL is an active partner in Sony's plans of offering IM services to the Playstation platform. While this has not happened on the PS2, it is most likely scheduled for the PS3.
Microsoft and the Xbox, not to mention the Xbox Next. 'Nuff said.
7. AOL is a preferred partner with Apple's iTunes.
Microsoft acquiring AOL will again be seen as a move to squeeze Apple out of the market just like over the AIM situation. This will only aide the antitrust lawsuit Real Networks has leveraged against Microsoft.
8. AOL was an institutional shareholder in Palm since the spin-off from 3Com.
Again, Microsoft acquiring AOL would be a headache because this would be yet another example of Microsoft hitting at its various competitors.
The Bush Justice Dept., already burned over the Antitrust Settlement, will in no way allow this to go through.
"Right now, somewhere in this world, Scott Baio is plowing a woman he doesn't love," - Peter Griffin, *Family Guy*
I read something like this and I think to myself
Does America have NO anti-competition laws???
In Europe it is highly doubtful a huge predatory company, with a track record such as Microsoft's, would get the EU go ahead to acquire/merge with a company like AOL.
This sig has been deprecated.
Actually, I could see Microsoft buying out AOL and it being a sensible business move.
The thing is, they wouldn't be running both AOL and MSN simultaneously. What they'd be paying for is the existing AOL customer base, which they'd then be able to migrate over to their service. (There are a number of ways this could be accomplished, but an "optimal" method might be creating a new "AOL 10" type CD that asks users if they'd prefer the "old AOL style" front-end, or just a direct connection to the Internet without it. This new CD could be modified to connect to MSN's existing phone numbers or gateways, allowing Microsoft to slowly phase out and sell off the hardware they obtained from the AOL purchase.)
As it stands, MSN competes pretty directly with AOL. (The "rest of us" don't generally consider either one a viable option for our internet needs.) If they absorb AOL, they might have enough customers to make it profitable.
If Microsoft acquires AOL/Time-Warner and Comcast acquires Disney, then Microsoft will effectively control the cable broadcasting and communications market.
.85 votes per share will likely be determined to be unfair, as all shareholders that are brought along in the merger will have not been given opportunity for fair consideration of those terms.
The key to this deal is Microsoft's position as the largest single shareholder in Comcast owning 15% of the companies stock. Compare this to the Roberts family (Ralph Roberts, founder of Comcast, and Brian Roberts, CEO) holdings of slightly over 1% of the company.
If Comcast acquires Disney, then a voting policy dictating that the Roberts family shares are weighted in voting to = 7.5 votes per share while other shares are = to only around
Just think about the future that these two deals could bring us, Microsoft being in control of the vast majority of news, music and recording, movie, and print media in the United States while being capable of dictating the protocols that are used to connect to, and to filter the trafic to and from, the internet.
It's not a tin foil hat theory. It's simply the logical extension of such consolidation of communication and media marketplace under the control of one company that has a rather nasty history of not respecting the wishes of the community that they chose to do business in.
Oh yeah, Paul Allen's vompany Vulcan Northwest Inc. owns a 5% share in Microsoft, so we can probably count Charter Cable and a number of other media and telecom companies as being involved in this as well.
Read, L
I suspect the biggest benefit for Microsoft buying AOL will be to compete against Google for search market share. Currently the market is split between Google, MSN and Yahoo. If MSN take AOL's share from Google they might be able to claim a majority of the search market when they launch their upcoming search engine.
However, there's a chance this will be another case of the European Union blocking a merger that American anti-trust law OKs?
Regardless of what has happened in the past with the DOJ and anti-trust cases, there would be no way that these three aspects of any merger would be overlooked. IANAL, but I would almost guarentee that they would be required to spin off at least AOL IM and Netscape/Mozilla.
After worldcom imploded, everyone looked to put the blame on them, but forget to ask about the partners in crime.
Simlar to the illegal practice of swapping bandwidth at the end of the quarter to inflate the value of the company that worldcom, quest and colt were involved in was also practiced by AOL.
But AOL has been deeply involved in Worldcom, as well as Microsoft with both of them.
Worldcom was also hugly overvalued, and way buying up company left and right, until the bubble burst when the MCI merger blew up.
The real question at hand is, when will the AOL bubble burst?
Or is there more to the Microsoft Worldcom AOL Triangle that will we find out when more people lose thier pension funds?
It is also a question, what is the real value of Microsoft? How much of it is hyperinflated, and what if it turns into another worldcom with cooked books full of accounting tricks. If it is anything like its partners, I would not be suprised if they were involved in such practices with them.
Also, Why is it that microsoft was interested in buying corrupt companies like Worldcom?
Introspection is the key to understanding
MSN is a money loser as well. But it's important to undertand that Microsoft doesn't "get paid" through direct revenues so much as through the valuation of their stock. And the price of their stock hinges on the perception that they control everything that touches the areas of computing and the internet--and that they will extend that control in the future by leveraging the monopoly. Even today their stock valuation is all out of proportion to their revenues and share price is how the company principals are paid. Everyone who buys MSFT at this point is buying the idea of an unstoppable monopoly that will roll up any competitor or partner in the long run. So it doesn't matter if AOL is a longterm money loser, they are the visible competition and the competition has to be seen being absorbed by MS, or ruined, in order for the MS mythology to sustain itself. Like a shark, MSFT has to continually swim, kill and eat or it will die.
Johnny Quest has two Daddies.