Micosoft-Yahoo: Make Yourself Comfortable, This Could Take A While
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Jerry Yang, Galvanised...
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By Martin Kelly, Editor, Search Engine Room
Waiting, waiting, waaaaaaaaiting for something to happen in the Microsoft-Yahoo! brouhaha... You may recall that Microsoft made a $48b offer in early February for Yahoo! which was eventually rejected by the Yahoo! board. Then – nothing. And still nothing.
It seems certain that this takeover attempt, so far a “friendly” one, could drag on for an awfully long time, perhaps all year, not a good thing for either company, particularly Yahoo! despite co-founder Jerry Yang describing it as a “galvanising event”.
Galvanising for the board perhaps, and Yang personally, but your average Yahoo! staff member would have to be seriously distracted by an uncertain future - the company said 1000 staff would be sacked in its latest results – aligned with never-ending speculation about the validity of the business model they are paid to develop and sell.
And the longer nothing happens, the more distracting it will become, the silence of nothing rising to a crescendo – a corporate version of Chinese water torture: drip, drip, drip, drip.
Meanwhile, Google has stayed quiet after an initial, bitter attack on Microsoft through a blog post by company legal boss David Drummond which characterises Google (and Yahoo!) as champions of “openness and innovation” while depicting Microsoft as a monopolist with dark intentions.
Google clearly wants the world to see it as a fight between Good and Evil. But it isn’t that simple, and any further rhetoric along these lines has potential PR downside in that it could be viewed by some as a case of the pot calling the kettle black.
It’s also obvious that, if an alliance eventually happens, Microsoft-Yahoo! will be a much more formidable competitor to Google than an ailing Yahoo! or a stand-alone Microsoft (and as such, is an entity many in the search industry would welcome).
Adding further spice, is Google playing the “openness” card, a which may inadvertently revive memories of Google’s actions in China. Sergey Brin admitted in a 2003 interview with Wired that Google gave the Chinese Government “a new mechanism that can block the results of certain searches".
Anyway, the post makes interesting reading – here it is:
“The openness of the Internet is what made Google -- and Yahoo! -- possible. A good idea that users find useful spreads quickly. Businesses can be created around the idea. Users benefit from constant innovation. It's what makes the Internet such an exciting place.
“So Microsoft's hostile bid for Yahoo! raises troubling questions. This is about more than simply a financial transaction, one company taking over another. It's about preserving the underlying principles of the Internet: openness and innovation.
“Could Microsoft now attempt to exert the same sort of inappropriate and illegal influence over the Internet that it did with the PC? While the Internet rewards competitive innovation, Microsoft has frequently sought to establish proprietary monopolies -- and then leverage its dominance into new, adjacent markets.
“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.
“This hostile bid was announced on Friday, so there is plenty of time for these questions to be thoroughly addressed. We take Internet openness, choice and innovation seriously. They are the core of our culture. We believe that the interests of Internet users come first -- and should come first -- as the merits of this proposed acquisition are examined and alternatives explored.”
Search Engine Room: February 28, 2008
