What Does A Combined Microsoft Yahoo Look Like?

by Karthik on February 1, 2008 · 19 comments

microhoo

Hot on the heels of the $44.6 Billion Offer made by Microsoft to Buy Yahoo, the web is going crazy with discussions on this. This deal if takes place, could well be the defining moment of Internet in 2008. This deal has large ramifications, beyond just about you and me can think of.

I’m not entirely sure, if this deal makes sense for Microsoft. The only reason Microsoft seems to be running behind Yahoo is to beat Google in Search and Online Advertising. The Bid seems to be a good deal for Yahoo, since the company has virtually been struggling for the past four years and 62% premium on the current value seems to be a good deal for the shareholders.

But it raises some obvious questions. Every Acquisition has always had one side loosing itself. Take for example Google’s recent acquisitions. Dodgeball, Jaiku, Measure Map etc.. All these companies had to suffer the wrath of Google. But take Youtube, it was a competitor to Google Video at the time it was purchased, and Google had to take some tough decisions on what it should do with Google Video. Now we see Youtube and Google Video coexisting happily without interfering with each other.

The Question is can Microsoft do this. For long we’ve known Microsoft to be a monopolistic company, with bigger than life interests. Let me ask you some questions here. I’d want all of you to comment on these questions that I’m putting up here..

  • Windows Live search or Yahoo search?
  • Live messenger or Yahoo messenger?
  • Live spaces , Yahoo 360?
  • MSN Dating (Match) or Yahoo personal?
  • MSN advertising platform or Yahoo advertising platform?
  • .NET or JAVA?
  • Live ID or Open ID?

Microsoft surely has some tough questions to answer, and speaking with reference to history, I think Microsoft would personally like to stick with its own services. This acquisition also raises questions as to what Microsoft plans to do with the poster childs of Web 2.0 namely Flickr and Del.icio.us. It would do more harm than good to play around with them.

There is also one more thing that the Yahoo Board would have to consider incase they decide to go ahead with this deal. A lot more people could be loosing their jobs at Yahoo, considering the amount of overlap in the services that the two internet giants offer and with the parent company that is Microsoft giving preference to its own properties over Yahoo’s inspite of Yahoo Services being more popular.

In my belief the deal is not a good idea for the whole Internet as well. Microsoft has for long shed away from promoting Open Source and we all know that Open Source is the future of the Internet and proprietary technologies like ASP will never work. And what’s even more important is that Yahoo has been ramping up on the use of Open Source Technologies with services like Flickr, Zimbra, Del.icio.us. So that’s again a point of differing interests of the two companies.

I don’t think a combination of Yahoo and Microsoft is going to reverse Google’s increasing search dominance. As Terry Semel said in 2006:

My impartial advice to Microsoft is that you have no chance. The search business has been formed.

He’s pretty much right, the search game is pretty much sealed, and Microsoft doesn’t have much of a chance here. Acquiring Yahoo would mean a lot of conflicts for Microsoft and its own services and its own technologies.

All in all I don’ think this deal holds value for either Yahoo and Microsoft, except this is probably the answer to all the struggles Yahoo has put up with its Finances and Stock. Yahoo gets a boatload of money if this deal gets through and looses its identity that it has built up over the years. And What does Microsoft get, nothing at all. There is no way Microsoft can defeat Google by acquiring Yahoo simply because conflicts in the interests of the two companies is one too many.

What do you think about this deal? Yahoo still hasn’t said a Yes or No to the deal and their board must be taking some decisions as I speak. But all in all if this deal goes through, Yahoo would be the biggest looser and Google would only become stronger.

Please Yahoo, please say No. I don’t want any of the services that have come to define the Internet to die at the hands of Oppressive Microsoft. Please live on, and Live Free and I’m sure you’d be able to get past all your recent troubles.

Please voice your opinions on this deal in the comments. We all need to discuss this, as it could forever change the landscape of the Internet.

Image Credit : Mashable

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{ 16 comments… read them below or add one }

Anon February 2, 2008 at 12:19 am

Shh please

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Dave February 2, 2008 at 12:56 am

I haven’t touched Yahoo in a decade, and am currently ditching my last Microsoft products(well, trying to). That said, I like this merger idea.
It would be good for Yahoo, Microsoft and consumers. Both manage to gain more market share against an increasingly powerful Google. The ad revenue and massive user count could lay the groundwork for spinning a new, more innovative consumer unit off or, in the very least, put a fire under Googles butt to keep it innovating.
The new frontier is mining. Whoever gets to mine the most keystrokes wins. I personally am not comfortable having that power in the hands of one company, no matter how groovy they are. I prefer Google, but welcome the competition.
Hey, it could be worse. It could be Verizon buying Yahoo. Everyone says Microsoft is evil, but there are much worse players out there.

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Thilak February 2, 2008 at 1:46 am

As far as IM is concerned, I’d stick to GTalk, but since you are asking me to pick one between Live and Yahoo, I’d go for Yahoo!

Search, of course Yahoo!

Frankly speaking, I’ve never really been a fan of Live or Microsoft. I’m satisfied with Google and Yahoo (for Flickr) at moment. Hope, things remain as it is!

At the same time, I don’t want Google to dominate the web. Monopoly can be awfully bad!

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Anif��� February 2, 2008 at 1:59 am

I agree with a lot of what you have said. When I heard the news, I didn’t think this was such a good thing. A good thing for Yahoo shareholders perhaps, but not for anyone else.

Based on MS track record, they stick to their own services just like you pointed out. They are closed and try to make everyone else follow their own standard. If this goes through, I’m not even sure what the future holds for all companies, the web, innovation, standards etc.

The way I see it though these are not some small startup companies, these are 2 powerhouses in the tech world. If this deal goes thru, it would take an awful long time to work out synergy amongst them. During this time, Google will keep innovating and out pacing them. I don’t think this buy would help MS, but I could be wrong.

* Windows Live search or Yahoo search?
They could probably coexist, one engine powers them both.

* Live messenger or Yahoo messenger?
I think Yahoo messenger would get killed off. Yahoo user accounts will be migrated to Live.

* Live spaces , Yahoo 360?
I think Live Spaces sucks, haven’t used 360, could care less for both.

* MSN Dating (Match) or Yahoo personal?
Could care less for this as well, people need to go out and meet other people.

* MSN advertising platform or Yahoo advertising platform?
I still don’t think either of their advertising platforms are a match for Google.

* .NET or JAVA?
I cannot see MS adopting JAVA. They will go .NET

* Live ID or Open ID?
Again, MS will always push their own services, so Live ID. But I think Open ID will kill it. There are a lot more companies on board with Open ID and a lot more support for it. Plus Open ID is “OPEN”, which MS is not.

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Lucas February 2, 2008 at 6:01 am

I don’t see what Microsoft want with this deal, everything that Yahoo has Microsoft has too. At some ocassions they’ve even more than Yahoo, like MSN.

I think which Microsoft will pay $44.6 Billion just to try (again…) to win some space at search engines.

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vinitneo February 2, 2008 at 7:49 am

I like both Microsoft & Yahoo. But I don’t think they should join, both of them have different services which by no means can combine, like
Windows Live search or Yahoo search?
–I don’t like both of them ..Google is better.
Live messenger or Yahoo messenger?
—I’d say Gtalk.
MSN advertising platform or Yahoo advertising platform?
—Google is a better advertiser.adsense is better.
Live ID or Open ID?
—I don’t think it’s possible to combine them.
Microsoft cannot beat Google by taking over Yahoo, Microsoft should concentrate on it OS only.
I however agree with Thilak on the dominance part.
Monopoly can really be bad.

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Rishil February 2, 2008 at 6:43 pm

I too agree with Karthik, the deal would be no good for yahoo nor for Microsoft. On a short term yahoo could be out of its financial mess, but would definitely die at Microsoft’s hands. Also it would be bad for most of the yahoo employees. They have lot of overlaps in services, so some services would be definitely closed.

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Karthik Kastury February 2, 2008 at 9:10 pm

thanks a lot for all your feedback. I have a feeling that if this deal takes place, it means a big victory for Google. Hasn’t anyone noticed the silence that google has maintained on this topic. They are pretty much sure, if this deal goes through, Microsoft just has no chance in the world to integrate itself with the corporate culture of Yahoo.

If you have ever heard of shooting two enemies with one arrow, this is exactly what Google is doing, killing Microsoft and Yahoo in one shot. As Thilak said Monopoly is a bad thing, and this deal would only make Google monopolize the web to a larger extent.

I’m sure none of us want it. Guess what would happen after Microsoft acquires Yahoo. A large portion of the Yahoo talent that has preserved within its rank would vanish overnight, and they would probably have only two options, one head to Google and the other to head for other valley startups.

I’m sure none of us want this. We all love competition, and its a whole lot better for Yahoo to stay independent to fight Google rather than be a Microsoft’s pet dog that would probably never bark again.

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Alex February 4, 2008 at 6:05 am

Karthik

I haven’t seen such pessimism since France 1942. Microsoft is NOT a monopoly, they are just rather large because, frankly, they are not evil corporate giants-they make good things. the YHOO! merger will definitely help both sides, if Microsoft does this right, and then we will have a MicroHoo vs. GooPle in the computing world. Quite frankly, this will lead to either enormous innovation and serious competition, or deadlock and the rise of new companies surpassing the stalled MicroHoo and GooPle.

If Life hands you lemons, make Lemonade.

And think longer term.

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ihnm February 10, 2008 at 10:20 pm

Windows Live search or Yahoo search?
lies search , since one powers both the result will be non sense
Live messenger or Yahoo messenger?
microhoo talk
Live spaces , Yahoo 360?
twist users 360 degrees in the spaces?
MSN Dating (Match) or Yahoo personal?
death dating of users
MSN advertising platform or Yahoo advertising platform?
i don’t want to see the ads conflict (or fighting on same page)
.NET or JAVA?
.neva
Live ID or Open ID?
Closed ID
Flikr or nothing?
it would be Likr

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Alan Wilensky February 15, 2008 at 2:28 am

Compared to carefully shopping for properties that would complement the Microsoft strategy for growing it’s search and general internet eyeball presence, the Yahoo deal represents the least opportunity for the most money, and the most heartache. Forget for a moment the incipient distaste the each and every Yahooligan has for Microsoft, the management and departmental integration alone would would drag down and drown any hoped for leverage of the properties.

40+ billion is a lot of money NOT to spend on a combination of smaller valley properties that could compete with the ostensible Yahoo portfolio. Let”s say, take 15 billion for Valley M&A. Take another 15 billion for a real, internal effort to do what you THINK Yahoo could have done for you as an acquisition.

It would save a lot of heartache. If Balmer and Ozzie think that they are powerful and smart enough to circumvent this sure as hell to come cultural battle, they better think again.

Google should just sit back and watch the train wreck. Much of the damage has been done, and continue with the Yahoo exodus of top talent, and yes, deadwood too. Losing Horowitz, the conscience of the new products group, was a blow to Yahoo that will be difficult to redress.

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Laxminarayan March 4, 2008 at 3:05 pm

I think Yahoo should hang a huge “Not for Sale” board outside all it’s offices/office buildings.

Yahoo is Yahoo and people come to it for just that. If Yahoo forgets this one basic thing, or does not consider it, it is a great loss to all it’s users.

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Laxminarayan March 4, 2008 at 3:08 pm

Alex : Are you from planet “earth” ?

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James March 18, 2008 at 1:37 am

I think this buyout is more of ego, than street smarts, but what do I know! Nobody uses Yahoo search anymore… well about 99% of the 3,000 visitors to Boomtrek.com daily come from Google by the weblogs, so what are they buying them for? Perhaps Flickr, Y! Mail and all the other mini-properties. Why don’t they just buy Facebook for $15 billion (or whatever ridiculous valuation Zuckerberg wanted) maybe they tried, perhaps he’d never sell out… but I see a big social network being one of the few ways MS can get back in the game. I also find it comical that Microsoft groaned about VeriSign “stealing traffic” from ghost pages (for lack of a better term) a page with no/bad DNS information, had VeriSign directing traffic to goto its SiteFinder program with .com registration and ads, and then Microsoft implements an auto-search on http://www.live.com directly if you type a “ghost website” in Internet Explorer toolbar that isn’t a valid domain. That is the ultimate in evil! lol… Sneaky things like this make me gravitate towards Google, its a mature search market and its best of breed, they own the search space on the PC, done deal. I think Microsoft would be better off focusing on home/media via Xbox 360 search/in-game ads, instead of “wasting” $44 billion or whatever the insane offer was on Yahoo!

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dating sites February 2, 2010 at 7:45 pm

Microsoft desire to be INTERNET space is getting reduced day by day

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Websites for Dating September 7, 2010 at 5:06 pm

Now we see Youtube and Google Video coexisting happily without interfering with each other.

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