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Why Yahoo Turned Microsoft Down
quarterbuck writes "The NYTimes has up a great blog post that explains a bit of the backstory behind the Yahoo-Microsoft No-deal. While Jerry Yang did not want to sell the company, it is not likely that he could have said No to Microsoft, and explained it to shareholders, without the help of Google. The article gives reasons behind Google's tossing a lifeline to its biggest competitor, and the 'coop-etition' that has been going on between the two companies, which both emerged out of Stanford University."
of chairs.
Hail Eris, full of mischief...
E pluribus sanguinem
If Yahoo's stock price continues to decline, MS has intelligently kept their offer "on the table".
If stockholders come to MS for a bailout of their capital, they don't even need a hostile takeover -- it will be a willing one. And the profits Yahoo posts from Google won't reflect in their stock price for a while.
We'll see how long it takes Yahoo investors to either let the company rebound, or to bail themselves out. Yang is in an interesting position, that's all I can say.
The price is always right if someone else is paying.
That's funny because I made a small fortune on the Google IPO. I sold and put it into safer investments since that time and don't regret it, however. I think it's way overvalued at the present time but I was happy to take my profits and run.
Only together can they defeat Microsoft, and rule the world as a monopoly so strong that even God will fall to his knees before them!
SJW: Someone who has run out of real oppression, and has to fake it.
The opening of his speech will be "Okay, so I lost you all of a shitload of money. But the important thing is, we stuck it to the big, bad Microsoft! WHO'S WITH ME?" There is more to the speech, but it's unlikely he'll be able to speak coherently after that, what with his lungs filling with blood.
SJW: Someone who has run out of real oppression, and has to fake it.
1. Microsoft probably can and will figure out a way to eventually stack the board of in directors in their favor at Yahoo. Microsoft has time, Yahoo doesn't.
2. Google is keeping their enemies closer at this point. This is basically a white-knight move on Google's part to keep Microsoft out of their space at all costs. The question to Google is how long will it be until this kind of action starts affecting their bottom line numbers.
In a very heartless way, I'm all for the Microsoft->Yahoo acquisition. Most acquisitions fail to generate anything near the claims management makes. Microsoft would simply leave the door open for ex-Yahoo employees to startup things that would be a bigger thorn in Microsoft's side.
Death by thousands of thorns if you will pardon the pun.
http://www.maxineudall.com/2010/02/should-economists-be-sued-for-malpractice.html
That's really the crux of all of this. The fact that the founders of both went to Stanford is hard proof of what I've always said: they are all part of a secret railroad monopoly plan hatched by Leland Stanford in the 1800s.
That's why he orchestrated the Hoover presidency and built the linear accelerator facility, which looks like the all-seeing eye when seen from the air. Google is really just a corporate front for the Stanford band, whose shadowy aim is to take over the world from their trailer, where Leland Stanford is kept cryogenically frozen!
The world, I say!
i dont think so
GOOG @77% > (YHOO @ 12% + MSFT @ 5%)
http://marketshare.hitslink.com/report.aspx?qprid=4
Google - Global 77.23%
Yahoo - Global 12.21%
MSN - Global 3.27%
Microsoft Live Search 2.50%
AOL - Global 2.41%
Ask - Global 1.37%
AltaVista - Global 0.11%
Excite - Global 0.07%
Lycos - Global 0.01%
All the Web - Global 0.01%
He only lost them money because the market is so unbelievably stupid that they actually thought a Microsoft Yahoo merger would work. Which anyone who knows anything about tech mergers knows is not true.
.....
See the HP Compaq merger for a prime example, or AOL Time Warner, or
Managing a company is also supposed to take care of it in the long run. Making one small onetime financial income at the expense of the company isnt god for the shareholders that are in it for the longer run. You are talking about day-traders and not real investors. A marriage with Microsoft would most surely spell certain doom for Yahoo as a company.
Its also not sure a Microsoft would be allowed to use its monopoly money from the Windows division to create another monopoly in search further on. Google buying Yahoo on the other hand shouldnt be a problem since its only when you use your monopoly in a bad way that US laws come into action or if you use one monopoly to subside taking over an adjecent market.
Shareholder value is not equal to stock value, its about what the company does in the longer run. Stock value is often completely useless as a measurement for how well a company is doing. Look at how long SCO had roaring high stock value? Was their moves good for their shareholders, except for hedgefunds and daytraders and other scum?
Yahoo has acted to continue living and not being bought up and then dismantled quickly after being gutted of its users. A shareholder cant just sue because its board do not favour short onetime gains at the expence of the companys future. If that was the case we would see companys gutting themselves and selling the pieces and totally disregard any possible future incomes down the line from products not yet released to the market.
HTTP/1.1 400
Any negotiations that Yahoo's board entered into were done in bad faith and in violation of the board's obligations to the shareholders that elected it.
What obligation is that? Is the board obligated to make a deal with Microsoft? Are they obligated to engage in a good faith negotiation with them?
You'd have to show that rejecting Microsoft's unsolicited bid was not in the best interests of Yahoo's shareholders. That may seem obvious to you now, but only time will tell. If they did negotiate in bad-faith, that is an affront to Microsoft, sure... but not grounds for a shareholder action per se. Keep in mind that they were responding to an unsolicited and unwelcome bid.
Jerry's sentiment was that he mismanaged Yahoo into it's present situation, and he would prefer to mismanage Yahoo out of it all by himself.
I don't think it really has anything to do with that at all.
When companies merge (or are acquired) their stock prices tend to go up in the short term. So it makes a lot of sense for buyers to buy Yahoo stock right before the merger (and sell shortly after) and for the current shareholders to sell.
In other words, with Yahoo refusing to sell, the shareholders can not cash in and make a shit load of money.
Yes the stock is down right now, but by "loose money" I interpret that as "now you can't sell when the stock price immediately jumps up due to the acquisition and get filthy stinkin' richer than you already are".
The only people who would care in the slightest what happens to MS or Yahoo in the long term are people looking at long term investments. I think the only people in that camp are the top Microsoft shareholders (obviously or they wouldn't be looking to acquire them). The rest of the Yahoo shareholders just wanted to cash in and go retire on their yachts.
IMHO, The interesting thing is that this was such a dumb idea that even greedy investors did not seem to want it. As soon as the buyout was proposed, MSFT stock tanked well over 10%. It regained some in the weeks after, but the biggest gain occurred when it looked like the deal would go bad, and when it became clear that Balmer was going to do the damn fool thing, the stock tanked again. Not a rousing endorsement that this deal would do anything positive. On the Yahoo side, the stock briefly spiked as some investors were looking for a quick payday, and others were looking to get rid of an investment they perhaps paid too much for, but no on really seemed to think it was a good deal as even when it seemed like MSFT might raise the bid to $37, the stock never went above $29, which seemed to indicate that investors seemed to think of this as a windfall and not a long term thing. Of course, the most interesting thing, is that while MSFT stock has not recovered, yahoo has not fallen back anywhere near the january lows.
As I see it, Microsoft was simply willing to burn some money to get some experience in a field that they are flailing in, and to knock out the competition. It was not a growth strategy, simply a way to tread water. Given that MSFT is still perhpas 20% down on the year, while yahoo is somewhat in positive territory, i imagine that this act of desperation has done more harm than good.
"She's a scientist and a lesbian. She's not going to let it slide." Orphan Black
I was going to hop on that bandwagon but I think I'm going to hold for a couple weeks. I feel a big announcement coming soon and I want to let the current holders fester scared first before I grab their goods at a lower price.
*sigh* I love capitalism!
...to be in the (hopefully chairless) room when Ballmer heard this news. The look on his face must have been priceless. Google is playing Chess, while Ballmer can barely handle checkers.
Insightful and funny are really the same thing, except one has a punch line.
All the analysis I've read is just nonsense. Google knows something that Microsoft and business analysts don't have a clue about.
A thriving market place makes a lot of money for everyone, yourself included. You have a vested interest in maintaining the market place.
The loss of a major fair playing competitor and the introduction of a stronger destruction driven monopolist makes it harder for everyone, including Google, to make money.
Google wants yahoo in place. They make money from Yahoo. Yahoo wants google in place, they make money with google. Where their businesses do not conflict, they work together. Both Yahoo and Google aren't fighting to destroy one another, they are in business to make money. It is friendly and profitable competition. They way it should be. The that capitalism works best.
Microsoft on the other hand can not compete on a fair market. They never have and never will be able. They must capitalize on their illegally maintained windows and office monopoly to destroy competition and destroy the marketplace leaving only enough business for themselves.
Google is a strong competitor, I don't "trust" them per se'. for The time being, however, they've shown that they understand ethics and the phrase "a rising tide lifts all boats."
It hasn't been all peaches and cream for the Wii.
Wii, though less technologically advanced than Microsoft's Xbox 360 or Sony's PlayStation 3, continues to outsell those machines and is now in more than 20 million homes.
So why are retailers having so much trouble selling Wii games?
Take Super Smash Bros. Brawl. It was one the most hotly anticipated video games of the year; it sold more than 1.4 million copies during the first week of its release.
But sales dropped more than 90 percent over the first four weeks.
A number of games that garnered critical acclaim in recent months, notably the cartoonish action-adventure game Zack & Wiki and the off-kilter action-adventure No More Heroes, have yielded disappointing sales.
Over the first three months of the year, only three other Wii titles broke the list of top 10 best-selling games.
Younger children, women and older consumers, who historically have not been sought by the video-game industry, have discovered video games through the Wii -- just not that many of them.
These new gamers are content with the games they have, often going no further than the Wii Sports game that comes with the machine. They don't buy new games with the fervor of a traditional gamer who is constantly seeking new stimulation.
The average Wii owner buys only 3.7 games a year, compared with 4.7 for Xbox 360 owners and 4.6 for PlayStation 3 owners.
"When you make a game like Zack & Wiki or Boogie, which turns the hard core off and doesn't reach the masses, then you're in trouble."
Wii Fit, an exercise game due next month, is expected to receive more marketing dollars than any game in Nintendo's history -- and the money will not be spent wooing young men. "Wii Fit is just not aimed at hard-core gamers. It's definitely aimed at the Oprah crowd. I bet they sell a million units a week for every pound that Oprah says she lost on it."
New Wii Games Find a Big (but Stingy) Audience [April 21, 2008]
5 dead cat bounces of 10% in a year give you at least a 45% annual rate of return, even after (ridiculously low) US capital gains taxes.
No matter how you slice it, that's good.
The trick is consistently finding the dead cat bounces instead of grabbing something just part way into its slide to oblivion. It's my understanding that the vast majority of day-traders who try to time the market in things like this end up losing money. I wish the author of the parent post good luck, it's not a game I want to play.