Microsoft Should Acquire SAP, Not Yahoo

Reservoir Hill writes "Randall Stross has an insightful article in the NY Times that says that if Microsoft thinks this is the right time to try a major acquisition on a scale it has never tried before, it should pursue not Yahoo but SAP, another major player in business software, thus merging Microsoft's strength with that of another. This is more likely to produce a happy outcome than yoking two ailing businesses, Yahoo's and Microsoft's own online offerings, and hoping for a miracle. Stross points to Oracle as a company whose acquisition strategy has picked up key products and customers while avoiding venturing too far from its core business, or overpaying. Stross recommends that Microsoft acquire SAP and leave it alone as an autonomous division — which would avoid a culture-clash integration fiasco. Besides, large enterprise customers are arguably the best customers a software company can have. A few dozen well-paying Fortune 500 customers may actually be more valuable than tens of millions of Web e-mail 'customers' who pay nothing for the service and whose attention is not highly valued by online advertisers."

Comments

Wrong POV.

[Whiney Mac Fanboy]

The article is looking at things totally from the wrong point of view - it's as if they believe that Microsoft's problem is that it has a huge pile of cash & don't know what to do with it.

It's not. Microsoft's problem is Google. Google are eating them in the only arena where you can make serious money on the web (ad brokerage) and doing things to threaten MS's monopoly elsewhere (Google Apps, Photoshop on linux, Webmail, etc)

The Yahoo purchase might not be a solution to this problem, but a SAP purchase sure as hell won't be.

(and frankly, I can't imagine SAP's websphere/java using userbase being enthused with the next SAP release being C# only)

Re:Wrong POV.

[ScrewMaster]

Because Google would /never/ considering doing anything in terms of an operating system. That's just silly!

I know you're just being funny, but you're right that they probably wouldn't bother coming up with their own proprietary OS. I mean, they already use Linux internally anyway: that plus a lot of their own code is one of their strengths.

Now, what would cause problems for Microsoft would be a Google distro marketed to the Dells and HPs and Lenovos of the world, and also on store shelves. Google has both the brand recognition and the in-house technical skill to pull that off, and it's probably that which keeps Ballmer awake at night. Hell, much of the overseas market would jump on a Google OS in a heartbeat: Microsoft is not well-liked in many parts of the world. I kinda hope they do it, just to shake up Redmond a little.

Worse yet for Microsoft, if such a Linux distro just happened to integrate phenomenally well with Google's online services and Android offering ... well.

Not quite correct

[EmbeddedJanitor]

MS's main problem is not Google per se, but a Google obsession.

MS has failed dismally with its various acquisitions, with very few exceptions. MS core money makers are OS and Office. They seem to be putting very little energy into Vista and fixing its problems, doing something which would make their core business sound. In fact it looks like they've just cut these adrift.

If Google had not emerged as the new obsession, they'd still be aiming for Apple with knock-off interfaces, Zune etc.

This is reaaly the MS tradgedy: instead of being customer focussed and delivering new exciting products and technologies (something such an organisation should be able to do with their huge resources), they have become competition focussed.