Microsoft Withdraws Yahoo Takeover Offer

mksmac writes "According to the KOMO TV Website, Microsoft has withdrawn its bid for Yahoo after presenting them with an increased offer that was subsequently declined by Yahoo. Frankly, this seems like a smarter decision on Microsoft's part, but I'd like to hear how other people feel about the deal. Should Microsoft have walked away, pressured Yahoo via a hostile takeover or sweetened the pot until Yahoo gave in?" For those who prefer it, the NYT also has coverage, and the story is also at news.com, among many others. I like the Beeb's version as well. And for the Microsoft-centric explanation of why the courtship is over, see Steve Balmer's letter to Jerry Yang.

Comments

Re:My question is...

[j0nb0y]

Where did you get that idea?

The general consensus on the street seemed to be that Microsoft was offering *too much* money... which is why Microsoft stock dropped when the offer was first announced...

I'm not a big fan of Microsoft, but it really looked to me like they wanted Yahoo. It was Yahoo's executives who didn't want the deal to go through.

Maybe I just watch too much CNBC.

...and Ballmer wrote as such.

[game kid]

...

We regard with particular concern your apparent planning to respond to a "hostile" bid by pursuing a new arrangement that would involve or lead to the outsourcing to Google of key paid Internet search terms offered by Yahoo! today. In our view, such an arrangement with the dominant search provider would make an acquisition of Yahoo! undesirable to us for a number of reasons:

• First, it would fundamentally undermine Yahoo!'s own strategy and long-term viability by encouraging advertisers to use Google as opposed to your Panama paid search system. This would also fragment your search advertising and display advertising strategies and the ecosystem surrounding them. This would undermine the reliance on your display advertising business to fuel future growth.

...

No need to speculate on what Ballmer has all but confirmed. :)

Re:My question is...

[CodeBuster]

I fail to see why MS would want to compete with Google so much Google is earning economic rent through their strong franchise business in search and online advertising. There is no way that they are not going to attract competitors. Microsoft is in the technology business too, so it is difficult to explain to your shareholders why you are not trying to capture a piece of that lucrative market for yourself, especially when you seem well placed to compete for a share of the spoils. Microsoft is trying to earn the best possible return for their shareholders and that means competing for a share of the market in which Google is earning strong profits going forward.

Re:MS, you lucked out

[Anonymous Coward]

Surprisingly yes, budget is a limiting factor in a lot of things at Microsoft. They can't or won't pay the premium needed to keep really top notch developers around, so their staff is made up of "company men" with no perspective on reality, mediocre developers who slipped through the hiring process, and the small contingent of good developers who just haven't gotten pissed off enough to leave yet. It's a problem a lot of companies seem to have when the stock payoff days are over but the management still buys into the myth of the company's infallibility.

Re:Credibility lost?

[Maury Markowitz]

> a merger with Yahoo would have been horrific for both companies

I always thought so too, but let me assure you, the rest of the finance world disagreed. Completely.

There's a certain momentum to mergers that has absolutely nothing to do with the companies involved. It has to do with cash flows and balance sheets. It doesn't make a difference what happens AFTER the deal is closed. That's the distant future, science fiction.

MS had cash, they needed to spend cash, this was a vaguely profitable company to spend it on. Game over.

Maury

Re:My question is...

[HuguesT]

Actually they offered $33 per share, which amounts to $47.5 billions. Yahoo wanted $53 billions, the greedy bastards.

Re:My question is...

[target]

Google and Apple have been fairly chummy for a couple of years now -- look closely and you'll notice that the iPhone ships with only Apple and Google apps, nobody else was even invited to the party.

That's sort of interesting until you actually take the close look you asked for and discover that the iPhone ships with Yahoo mail and search as built-in options. Yahoo mail was even the default option for non-Apple-based mail.

So yeah, they may be allies, but your case seems to be somewhat lacking actual facts. Which is fine, this is slashdot.

Re:Printing? Ever heard of Latex?

[willyhill]

You are doing a disservice to free software when you sit there and claim that publishing professionals can replace their commercial software tools with a hodgepodge of immature applications that have about as much user base and corporate acceptance as Microsoft Bob. PostScript is *not* a standard used in the printing process *anywhere* nowadays, it's fairly obvious that you are just making that up or you are still stuck in the 90s. Look up PDF/X and JDF and educate yourself.

I would be happy if there was something even remotely similar to the Adobe design/publishing stack on Linux, but the reality is there just isn't. Mentioning LaTex and Emacs (WTF) on the same paragraph as your claim of desktop publishing superiority is laughable at best.

Next time, just use one of your other eight accounts so people think you just got here and have no idea what you're talking about. They might be more lenient with the mod points.