Yahoo’s struggle to evade Microsoft
p2pnet news | Product News:- Yahoo CEO Jerry Yang says the company is trying to find ways to avoid being swallowed whole by Microsoft.
“Our board is thoughtfully evaluating a wide range of potential strategic alternatives in what is a complex and evolving landscape,” Yang wrote in an email, says Associated Press, going on:
“He emphasized no decision had been made on Microsoft’s six-day-old bid, initially valued at $44.6 billion, or $31 per share.”
Yang, “didn’t set a timetable” for Yahoo’s response, saying the board will, ” take the time it needs to do it right,” according to the story.
Ironically, in what has been one of the most fulsome and hypocritical support statements ever made, “This is about more than simply a financial transaction, one company taking over another,” said David Drummond, senior VP, corporate development and chief legal officer, last week.
“It’s about preserving the underlying principles of the Internet: openness and innovation,” he said on the Google blog, going on to wonder nervously:
Could the acquisition of Yahoo! allow Microsoft – despite its legacy of serious legal and regulatory offenses – to extend unfair practices from browsers and operating systems to the Internet? In addition, Microsoft plus Yahoo! equals an overwhelming share of instant messaging and web email accounts. And between them, the two companies operate the two most heavily trafficked portals on the Internet. Could a combination of the two take advantage of a PC software monopoly to unfairly limit the ability of consumers to freely access competitors’ email, IM, and web-based services? Policymakers around the world need to ask these questions – and consumers deserve satisfying answers.”
Most of Yang’s email, filed with the Securities and Exchange Commission, “tried to cheer up Yahoo’s employees, many of whom are likely to lose their jobs in the months ahead, one way or the other,” says AP, continuing:
“Yahoo already has drawn up plans to trim 1,000 jobs from a 14,300-employee payroll in an effort to boost its sagging profits. The layoffs are expected to be even more severe if Microsoft devours the company because about $1 billion in expenses would be cut in a takeover. And if Yahoo were to eschew Microsoft in favor of a debt-laden leveraged buyout, about 4,500 employees could be fired, estimated Stifel Nicolaus analyst George Askew.”
Nonetheless, “We have a lot to be excited about and there’s more good news to come,” Yang wrote in his email, citing the shake-up of Yahoo’s online music service, and plans to unveil new products at a mobile conference in Barcelona next week.
“Google CEO Eric Schmidt reportedly has broached a potential partnership with Yang, but that alliance might be blocked by antitrust regulators worried about the competitive fallout if two of the Internet’s biggest ad networks join forces,” states AP, adding:
“Antitrust laws almost certainly preclude Google from trumping Microsoft’s bid in an attempt to buy Yahoo outright.”
Also See:
Associated Press – Yahoo CEO Hoping to Thwart Microsoft, February 6, 2008
fulsome and hypocritical – Google lashes out at Microsoft Yahoo bid, February 4, 2008
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February 7th, 2008 at 9:26 am
I think Yahoo and MS could benifit from a closer relationship but a buyout might be going too far.
But if it happens I don’t think the internet will explode.
People will move on and let it go.
Remeber that the Internet is a corporate venture and an open venture.(Maybe someone should tell MS and Google that)
February 7th, 2008 at 6:58 pm
Something that concerns me about Microsoft’s bid was blogged at FunAdvice a day or two ago. How will Microsoft handle running Yahoo!’s various open-source web-based services?