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Friday, Feb. 1, 2008 at 8:40 am

Is Microsoft Yahoo’s Salvation?

By Jeffrey Eisenberg
February 1st, 2008

Microsoft made a bid for Yahoo!.

On paper this deal might look right, but how about the cultures?

What do you think; is it a good deal?

Add Your Comments

Comments (9)

  1. I think that it is a great idea for both. Assuming that Microsoft and Yahoo are going to keep spinning in circles while Google moves forward, something major like this seems that it may be the only answer. Ideally either company would have done something unique or better than Google or the other, but their lack of creativity is going to get them nowhere. It’s time to go with the brute force attack. This is the only way for two boring companies to make any headway.

  2. On one hand I can say, I’ve got two words for you in regards to mixing the two cultures, culture shock. If you were to take a look at the personality types that choose Microsoft over Yahoo and vice versa for search engines, it reminds me of the MAc vs. Windows commercials that we’ve all seen too many of over the past year. (Although lately they have subsided, at last!)

    On the other hand, this could be a wonderful idea. Here’s why, if Microsoft takes the time to line up the key features of Microsoft search engine versus Yahoo’s version, go through the trials and tribulations to find the best features to present to users. NOw, this will undoubetedly be time consuming and costly but in the end, I think that Microsoft could give Google a power challenge.

    Given the history of Microsoft, it could go either way, this could be a disaster bigger than it’s debut of Windows ME or it could be a huge leap for Microsoft. In this case, only time will tell.

  3. Yahoo? Are they still in business? ;-)

  4. Is it good deal? I’m going to have to say no.

    There are a lot of moving parts in it, so its hard to walk through it all. I’ll try to hit the highlights.

    A) All the talk is that the MSFT bid will have to increase into the $36 – $40 range. It will be a challenge for MSFT to get their value out of that price. Has anyone outside of YHOO thought the stock was worth more than $35 in recent memory?

    B) How is a combined MSFT/YHOO really going to change the competitive landscape in consumer Internet services and online advertising? At the this point, the justification would have to sound something like, “Well, we both suck separately, let’s throw it altogether and see how it goes.” That NEVER goes well.

    More B) GOOG is still moving ahead at a blistering speed on innovation and capturing market share (spare me on the recent GOOG stock slide). If MicroHoo! gets caught up in distractions around products, infrastructure and cultural issues (MSFT & YHOO have cultural issues within themselves), then GOOG could have an easier time taking marketshare from from MicroHoo! than it did in the past.

    C) There has always been a rumor that GOOG participates in ANY Online Marketing M&A bidding deal: a) to drive prices higher for competitors with less cash and weaker stocks and b) to keep competitors from getting what they want – basically out of spite (see AQNT & DCLK).

    That’s all for now. In 24 months I’ll post my “See I’ll Told You So” on the deal.

  5. Well, Yahoo is such a mess right now – call me cynical, but I just can’t see Mr. Softy being able to clean it up.

    Can anyone name a big company merger/acquisition that’s actually worked?

  6. I thought Perry Marshall put it best this week…

    Purely from a PPC point of view & given the massive difference in quality/usage of the three ‘leaders’
    He said that combining M’soft & Yahoo to take on Google was like getting two people with an IQ of 75 and entering them into a spelling bee and hoping that means they’ll spell like someone with an IQ of 150
    Instead all you get are two stupid people that argue about how to spell everything.
    Excellent!

  7. I think the biggest issue is, will they be called Yahoo!Soft or MicroYahoo! That’s a tough call.

  8. Wondering if, after all the speculation, the deal will ever go through!

  9. Mary, I think they’re called Ya-who! now…

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Jeffrey Eisenberg, founder of FutureNow, is a professional marketing speaker and the co-author of New York Times and Wall Street Journal bestselling books Call to Action and Waiting For Your Cat to Bark. You can friend him on Facebook.

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