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Falling Microsoft Income Endangers Yahoo Bid
Dionysius, God of Wine and Leaf, points out a new wrinkle to Microsoft's pursuit of Yahoo. The most recent quarterly results, which saw Microsoft's earnings drop by 6% from the previous year (revenue from Windows alone was down 24%), have caused the stock to dip. This has reduced the value of the cash-and-stock offer from its original $44B to something nearer $40B. Yahoo, of course, has maintained all along that the original offer was lowball. A business professor is quoted: "Whatever leverage [Microsoft] built up in the last few days could be slipping away."
Anyone who was around during the dot-com era remembers how it was H-1b limits that caused the crash of that wonderful era. Those who do not learn from history are doomed to repeat it.
Seastead this.
Lets all say that together, shall we? "Falling Microsoft Income" Beautiful........... Do I get two more wishes?
It was the absurd level of investment which saw things like startups being valued higher than HP, Xerox, and if I remember rightly, the Ford Motor company, that caused that.
Venture capitalists poured billions into the industry without considering that the market had yet to produce the great new age of commerce that was promised.
Startups without a coherent product were valued as multiple million dollar companies, and attracted investment like dead dogs attract flies.
And all this at a time when I believe broadband wasn't even widely deployed.
It was a bust waiting to happen. It's just a shame that so many viable companies were taken down in the crash.
A learning experience is one of those things that say, 'You know that thing you just did? Don't do that.' - D. Adams
If you think that Yahoo which is trading over 40 to 50 PE as lowball well then YAHOO is crazy.
Look at the earnings growth of Yahoo for the past five years. IT IS pitiful. Yahoo is being too arrogant for its own good.
Personally, I think Microsoft should just walk away. Watch that Yahoo stock drop faster than gravity.
"You can't make a race horse of a pig"
"No," said Samuel, "but you can make very fast pig"
Software can compete on microsoft's platform, if microsoft is not trying to compete with that software. Just you try producing a word processor for windows, you will waste thousands of man hours reverse engineering proprietary microsoft formats, instead of improving your product. And even if you do spend the time and effort to produce a product that is both superior and compatible, you will face a serious uphill battle trying to get anyone to use it.
If we had a truly open single platform, progress and innovation would have been a lot faster.
It was always inevitable that a more open platform would take over from the myriad of incompatible systems that were available years ago, unfortunately it was only the hardware that was open, or at least competitive, while software became more locked in than ever.
Microsoft have stifled the evolution of the open IBM compatible platform, not helped it. They stalled the transition to 32bit, and are doing the same with the transition to 64. They delayed other valuable technologies like USB and SATA by being way behind everyone else in supporting them. And they are keeping people stuck on the crufty legacy bios, because of their unwillingness to support EFI, or anything else that would be newer and better. How many other good technologies have been delayed or killed completely, simply because microsoft couldnt be bothered to support them, or supported them in such a half assed way as to make people falsely perceive them as useless.
They (along with other closed source vendors) are also stopping people moving to other superior architectures (some of which are more open than x86, but less widely supported because they wont run windows).
http://spamdecoy.net - free throwaway anonymous email - avoid spam!
It is the falling revenue that hubris is set in motion. It is by the gook of management that self-destruction acquires speed, the product line acquires bloatware, the bloatware becomes a warning. IT is by falling revenue alone that hubris is set in motion.
Maybe we deserve this world ?
Besides which, I cannot agree with your statement one bit - Microsoft makes damn good mice and joysticks!
Gentoo Linux - another day, another USE flag.
this might shock you so hold on to your strawberry daiquiri, it takes years to get enough experience to even start training at the level MS needs to hire people to stay competitive.
If you mod me down, I will become more powerful than you can imagine....
This is the first indication of Microsoft actually feeling a bit of pain due to Vista.
Microsoft could afford to misspend the money it took to develop Vista. But Microsoft cannot afford to allow Windows share in the installed base to erode 10 points from the current level. Apple has already taken advantage of that opening, and Linux, mainly Ubuntu, is growing even faster, though from a such a tiny base that the statistics are iffy.
How bad would a 10% decline be? It would leave Microsoft with 80% of all personal computers that access Web sites. That doesn't seem irreversible. But it is worse than it looks for two reasons:
1. That 10% contains a large number of opinion leaders.
2. The momentum would be hard to reverse.
If a 10% decline happens in the next 18 months, before Microsoft has a response, then Microsoft will be in serious trouble.
3 years is far too long for Microsoft not to have a response. Well within 3 years we will know if we have a long-term competitive environment for personal computer OSs, possibly with new entrants other than Mac OS X and Linux.
I wrote parts of this stuff