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Microsoft Bids $44.6 Billion For Yahoo
The news is everywhere this morning about Microsoft's $44.6B offer to buy Yahoo. The offer represents $31 a share, a 62% premium over Thursday's closing price; and Yahoo's stock price has been rising in after-hours trading. Microsoft has been making overtures to Yahoo since 2006, according to the CNet article, including a buyout offer last February that was rebuffed. Mediapost.com has some perspective on the deal from the point of view of ads and eyeballs. Such an acquisition, which would be Microsoft's largest by far — it bought Aquantive last year for $6 billion — would need approval by US and EU authorities. A European Commission spokesman declined to comment.
Seems so unlikely to ever be allowed by the regulators, yet they're willing to throw billions at it anyway. They must feel confident for some reason.
So this means people will begin avoiding Yahoo with the same impunity they avoid MSN?
Theoretically Microsoft could buy up anything good about the internet so we can all shut our computers down and settle in w/a trip to the library and a good book.
*Repent!Quit Your Job!Slack Off!The World Ends Tomorrow and You May Die!
Maybe, but the possibility of there only being two main search engines out there, with the next largest competitor Ask.com at a paltry 4.1%, is fairly scary.
It was only a matter of time before Microsoft decided to try to get a final regulatory pass from the Bush administration before the inauguration of a less-sympathetic President in 2009.
This deal makes a lot of sense for Microsoft (sort of - I'm assuming Yahoo!'s ad business really is worth the cash), but I can't see how this is at all good for Yahoo! or the marketplace at large.
Is the plan to re-brand everything as Microsoft Live! (keeping the exclamation mark) - thus destroying pretty much the only thing Yahoo! has going for it - brand recognition?
I would be very sad to see Yahoo! and their odd collection of services get subsumed and destroyed in a merger with Microsoft. Yes, I'm assuming much of Yahoo!'s tech portfolio would be wiped away or left to die - this wouldn't be the sort of merger Adobe engineered with Macromedia by a long shot.
Shit, now this means the photos I have on flickr are going to be owned by Microsoft? Oy vey. Can we have a "good photo sharing site" thread now so I can find the alternatives?
gameDB
I think I'm going to be spending a few hours every night downloading and saving my email off line.
Huh? If it's *at all* important to you, you should already be keeping offline copies. Yahoo could lose all your email at any time with no redress - and this has happened to many webmail users on a number of occasions.
It's not as if hard drive space costs anything to speak of these days.
Microsoft is looking to put google out of business.
"Today, the market is increasingly dominated by one player, who is consolidating its dominance through acquisition," Microsoft said. "Together, Microsoft and Yahoo can offer a credible alternative."
Am I the only one who sees the ironic humor of this statement?
Fair enough - but my understanding, based on what I've heard from people who work for MSN, is that MS is not particularly good at running large data centers. It's not one of their strengths. And I'm speculating that Yahoo may be better at it because data center ops are more central to their business.
They removed a perfectly running FreeBSD from Hotmail and installed (first fake than real) Windows instead. You have seen the results.
They think that they can improve management at Yahoo! to the extent that, over an extended period, they will make more money than the deal is costing them.
It's tangentially about putting Google out of business; not for the emotional satisfaction or to prove they are better, but because Google makes a lot of money, and that is something Microsoft likes to do, so they tend to always be looking for ways to do it.
Nerd rage is the funniest rage.
Yahoo is generally quite a bit more prominent than Google in Asia, and there are quite a few people there. Microsoft has a lot of money to throw around, and if they can make Google insignificant over there, that limits the markets Google can grow in and may pose some serious problems. But it'll take some time before we see any significant marketshare changes I think, and anything can happen. Microsoft might have the big money, but you never want to underestimate Google.
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This is precisely why I almost threw up a little. The greatest and in many ways, superior alternative to exchange, possibly handed over to the one who would love nothing more than to kill or pervert it into oblivion.
...Instead of using buzzwords like "this proposal represents a compelling value realization event for your shareholders", you could say something like "this is a good deal for your shareholders."These MBA types may be all fat and bluster, but often let the truth slip out anyway. Don't read more into his statement than is there. Sure, if you were in charge, you'd be working on deals that would be good for your shareholders.
But that's not what he's about and that's not what this deal is about. "Value realization" is an obfuscated way of saying "extending our desktop monopoly to web searches" and "locking web users into our proprietary protocols and technologies".
Beta is broken and the link to classic doesn't work. Stop wasting our time or there won't be anybody left here.
In other words, Microsoft is putting them on notice that they intend to take Yahoo over, and if the board does not agree then it will be a hostile takeover. In other words, if you don't agree, your job is toast :)
No bad thing: Yahoo has been floundering badly for some time (well, ever since Google arrived, if we're honest) and needs some serious work before it has any chance of being an effective competitor to Google.
[FUCK BETA]
Brief analysis of some key points:
1) Microsoft is indicating that they are challenging Google "Today, the market is increasingly dominated by one player who is consolidating its dominance through acquisition. ". However, This statement should apply to Microsoft. Microsoft is the 800lb gorilla yet they are making it sound like they are a bit player and Google is the gorilla - more management doublespeak.
2) Microsoft is indicating they would replace all non-Microsoft at Yahoo with Microsoft technology with phrases like "combination enables synergies related to scale economics". This is great market speak for lay off all that oppose the Microsoft initiatives and move to a common, Microsoft-centric platform.
3) Microsoft wants their search as, I guess, MSN has not been effective: "single search index".
4) Phrases like "eliminating redundant infrastructure and duplicative operating costs" are management speak for layoffs, firing middle management at Yahoo, moving to Microsoft's management and benefit structure, and similar. In my experience through many corporate buyouts, all are very negative to the employees at the company being purchases - Yahoo. However, Microsoft attempts to temper this with "offer significant retention packages to your engineers, key leaders and employees", which is more corporate double-speak.
5) The "exceptional display and search advertising capabilities" sounds like a tighter integration with Microsoft's technology, i.e., Windows and MSIE. Maybe they want to have tighter integration between Vista and their ad revenue stream. Could "new advertising platform capabilities" indicate ad-supported Vista (get a free ad when you log in, when you fire up Office, etc.)?
Overall, it sounds like Microsoft is saying that Yahoo should sell to them because Yahoo didn't meet their goals, the combined company can better challenge Google, and Yahoo has tech that Microsoft needs.
Interesting that - imagine building a business using online apps, only to have your supplier go under and get bought out in some botched effort, and then lose history... Dude, that's the first thing I thought when I heard of "application service providers." For starters, I hated the industry since they couldn't find their own fucking acronym, they had to keep getting everyone confused with the other ASP.
Here's a good example I just found out about, an asp going after doctor's offices. In the last few I've been in, they're still running apps off of ancient LAN's, some are even DOS-based. All they need is a simple client-tracking and medical billing database and there's not been much need to upgrade for the past 20 years. That's no different from the cash registers you see in a lot of stores that are still connecting to some ancient computer in the storeroom and are running dumb terminals up at the register. Hey, if it ain't broke, don't fix it. They could conceivably keep running such a system until the hardware is no longer available on the used market.
Now compare that to an asp doing the same thing and there's just loads of trouble.
1. They get bought out by Microsoft or someone and the product is borked. Well, if that happens with stand-alone 3.0 then you just don't bother upgrading to 4.0 when it comes out. If it's an asp, you get upgraded whether you like it or not.
2. Do they really do backups the way they're supposed to? How many times do we hear of big companies who should know better royally screwing the pooch on backups and/or security.
3. What if the company goes out of business? Again, you can keep running stand-alone 3.0 for years after the parent croaks but that isn't happening with asp 3.0.
I just don't understand how nobody else is put off by these real and extraordinary risks.
Kwisatz Haderach
Sell the spice to CHOAM
This Mahdi took Shaddam's Throne
That was my first thought. They can have the portal, the ad business, but PLEASE! excise Flickr from the deal...I'm kinda sorta glad that I haven't based my photo collection with them, but their service has been really nice for sharing photos with other people. Guess it's time to go some other place to host my photos...
We're all hypocrites. We all have hidden parts, it's the contrast between them that make us more a hypocrite than others
Reminds me of the Sony root kit debacle, the blogger who released the information about the root kit, his association with M$ and that M$ was fully aware of the root kit well before it's release and for some odd reason the release of the information about the root kit coincided with the launch of the PS3.
The Sony rootkit debacle began in October 2005. The PS3 was released in November 2006. How, exactly, did these two events coincide?
Just because it can't be explained doesn't mean it isn't true. Science fits into reality... not the other way around.
This just blows me away. Yes, Microsoft, in concert with some nefarious blogger, is to blame for "$ony" taking over people's PC with a rootkit.
And that's ignoring that your conspiratorial "$ony the victim" timeline is just completely wrong.
The M$ moniker is perfectly legitimate and weakens nobody's position in the slightest.
Arguments are weakened by false or inaccurate premises, writing M$ gives a perfect idea of the bias of the poster
Durr. Those two statements contradict each other. Yes, writing M$ DOES give a perfect idea of the bias of the poster...that is, a blind Microsoft hater that takes any opportunity to criticize them.
because they do business in the EU and they have subsidiaries in the EU.
Years ago Microsoft said they would be the #1 search engine and set up Microsoft Network using their best and brightest tech staff and the cutting edge of Microsoft technology innovation, they released many new features bought up some services and integrated them and the best they have achieved is #3 and they seem to be stuck there.
Before MS buys something more successful than they are - I think they should do some serious introspection as to why exactly they were not able to achieve such a lofty goal on their own given how much more value they are (in their words) to the customer. If they just buy #2 there's probably a good chance they will sink back to #3 again as they integrate their #3 ideas on a business operating at #2.
I would think if they really wanted to be #2 they should pay Yahoo to 'buy MSN' and let Yahoo figure out what is wrong with their #3 problem and overlay the staff, technology and features that could make MSN #2.
"Enjoy what you're doing! If it becomes drudgery, you're doing it wrong!" - Jim Butterfield
In what way is "M$" perfectly legitimate?
Look, you have a few choices:
1) You can type Microsoft like a normal non-cretin
2) You can type the stock-ticker abbreviation, MSFT
3) You can type the accepted acronym, MS
All three of those options work. M$ isn't any of them.
Comment of the year
Why would anyone utter the term, anti-trust when talking about an MS/Yahoo merger. Neither come close to control of a market ANYWHERE. Combined, they equal nothing special.
Often wrong but never in doubt.
I am Jack9.
Everyone knows me.
I hope this deal will not go through. I use Google's products over Yahoo's as a matter of taste; I find Yahoo's pages too cluttered to be aesthetically pleasing. Be that as it may, the last thing I want to see is Yahoo going under; which, in my humble opinion, is exactly what this deal would amount to in the long run. Microsoft has a long history of buying out innovative companies and products and subsequently turning them into Passport/Live/insert-buzzword-here clones with vastly inferior functionality than their previous iterations. If Microsoft buys Yahoo! and slowly runs it into the ground, slowly replacing Yahoo's key engineers with Microsoft people, what major competitor will be left to offer (real) innovative competition to Google? I respect all the good that Google has done the Internet as a whole, but I am not blind to the fact that the corporation is now a publicly traded company, and thus subject to the whims of shareholders. If Google's most threatening competitor becomes stagnant, or even regressive, how will Google justify research and development costs to its shareholders? Maybe I'm wrong and Microsoft will retain Yahoo!'s management and employees more or less as they are, but I doubt it. I see this deal as injurious to innovation in OS-independent web technologies.
If Yahoo is integrated into Microsoft as tightly as I think it would be, then I agree with you that Yahoo is dead. MSN is already be a better portal than Yahoo anyway, IMO. I don't use either on a regular basis, so take that what it is worth. However, I think that Microsoft will have sunk 44 billion into something that gives them little competitive advantage. There no technology advantage, no advantage for consumers, and little net financial advantage even with a boost in advertising.
Coderz 4 Life
Most of the conversation has been about reducing the number of search engines from three to two. But for some businesses seeking on-line advertising, this merger will reduce the number of choices from two to one. If you are a business in competition with either Microsoft, one of its 'Channel Partners', lackeys, or other minions, MSN is simply not a viable option. I seriously doubt Microsoft will allow Yahoo to escape its 'One World, One Program' marketing vision.
Have gnu, will travel.
I certainly hope (and think) so!
I was a loyal and early user of both Yahoo and Microsoft products. There is nothing like a loyal user scorned.
Microsoft's version to version bloat, buggyness, and most of all, attempts to lock one product inextricably to another, plus their habit of acquiring other companies who's products I used, only to simply discontinue them or render them unrecognizable -- all of this, finally, drove me away in disgust. I gave up my career in order to avoid having to deal with MS crap.
What puzzles me is how you (and others) cannot see that Yahoo is made in the same mold as Microsoft already.
I've been (unfortunately) involved in some Yahoo Groups for a long while and countless times have had to explain the tortured process for an outsider to sign up for Yahoo Groups, involving them not only giving up (or faking) a lot of personal information, but also agreeing to take a Yahoo e-mail address as part of the process. How many of the claimed bazzillion Yahoo e-mail addresses are (as I suspect) mostly unused? I'd guess a lot. I had one guy tell me he never could remember his Yahoo sign-on, so every time he wanted to check the messages in the group he would just sign up for Yahoo all over again. They stuff is so crappy it makes me sick to even think about it.
Do you use Flickr without paying the premium fee? I can't imagine why anyone would. They keep everything you upload, but hide all but the last 200 picture from you. This is the most retarded scheme I've ever heard of. They must have the largest collection of unaccessible information on Earth! To help them out I just continue to upload files. I keep the pictures I actually want to view on Google. Flickr has had a lot of service outages, and for me is often painfully slow. Is it any wonder?
How can you stand all the stupid animated graphics that Yahoo throws at you? Half my screen real-estate and 90 percent of my bandwidth is used up with this silly junk when I go to a Yahoo page.
I know only one or two people who use Yahoo as their primary e-mail account, and maybe not coincidentally these are the people who don't seem to have their e-mail act totally together, don't respond to important messages, can't keep their CCs and BCCs straight, and since they are universally Windows users, are often having serious computer problems anyway ("Sorry, I haven't been able to check my e-mail in three weeks, my computer keeps locking up, got any ideas?").
These two companies are a match made in heaven. I wish them the greatest of happiness, and I hope they alienate a few billion more users along the way so that the rest of us can stop playing the role of free tech support for them.
Why does it mean he's a blind Microsoft hater? He could very well be a knowledgeable Microsoft hater like the rest of us who have to suffer through the nightmare of Microsoft because they managed to get control of the market despite there being much better alternatives out there that the knowledgeable Microsoft haters have been using for years. The bias is likely for very good, supportable reasons.
Who is John Galt?