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All posts tagged ‘Microsoft’

Friday, May 9, 2008

Jerry: You Wanted Independence, So Back Away From Google Slowly…

Kevin Maney

Reports, rumors and innuendos are bouncing around the Web that Google may not want to cut an advertising deal with Yahoo after all. This before there is actually substantiation that Google and Yahoo are crafting an advertising deal, which was something of a rumor and innuendo in the first place, allegedly planted to let Microsoft know that Yahoo had options.

Google is allegedly worried about ticking off Washington officials who might think that if Google is playing ball with Yahoo, Google has become an antitrust violator that must be terminated. As if Google isn’t already close to monopoly power in search. It gets 67% of all searches, and that share keeps growing. Google worrying that a Yahoo deal will push it over the brink in antitrust is like Kim Jong-il worrying that if he puts on a party hat he’ll be considered crazy.

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MySpace Partners With Yahoo, Twitter, eBay on Data “Availability”

Marshall Kirkpatrick

In a surprise move just unveiled this morning, a handful of big players led by MySpace and Yahoo have announced that public profiles, photos, videos and friend networks will now be portable from one site to another. We’re immediately wondering why this was a partnership between a handful of big sites instead of a move to truly open the Web in general.

According to a first report on TechCrunch, the initiative will begin with user information from MySpace being made available to Yahoo, Twitter and eBay in the next few weeks. MySpace is reported to have said that they will seek ways for “mom and pop sites” to participate as well in the future.

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Is Flickr Worth $4 Billion?

Mark Evans

In the wake of Microsoft’s aborted courtship of Yahoo and Jerry “Oh, did you increase your offer?” Yang, there’s bound to be a lot of scrutiny about what’s next for Yahoo.

One asset that’s well known but perhaps not scrutinized from an investment perspective is Flickr, the world’s most popular photo-sharing site that Yahoo picked up for a song (estimated $40 million) in 2005. Today, Flickr attracts more than 44 million unique visitors a month, according to Comscore, while Compete.com reports Flickr had 30 million unique visitors and 70.2 million page views in the U.S. last month.

Despite Flickr’s popularity, it is arguably under-monetized. In terms of advertising, it’s minimal at best. Instead, Flickr makes most of its money by selling Flickr Pro memberships for $24.95/year and offers e-commerce services through partners such as photocards, posters, frames and calendars.

So, what’s Flickr worth, and, more important, what could it be worth if it was managed more aggressively?

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Thursday, May 8, 2008

In the Air: Who Says Big Ideas Are Rare?

Malcolm Gladwell

In 1999, when Nathan Myhrvold left Microsoft and struck out on his own, he set himself an unusual goal. He wanted to see whether the kind of insight that leads to invention could be engineered. He formed a company called Intellectual Ventures. He raised hundreds of millions of dollars. He hired the smartest people he knew. … Myhrvold wanted to make insights–to come up with ideas, patent them, and then license them to interested companies. … One rainy day last November, Myhrvold held an “invention session,” as he calls such meetings, on the technology of self-assembly. What if it was possible to break a complex piece of machinery into a thousand pieces and then, at some predetermined moment, have the machine put itself back together again? That had to be useful. But for what?

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Microsoft May Build a Copyright Cop Into Every Zune

Saul Hansell

If you like to download the latest episodes of “Heroes” or other NBC shows from BitTorrent, maybe you shouldn’t buy a Microsoft Zune to watch them on. A future update of the software for Microsoft’s portable media player may well include a feature that will block unauthorized copies of copyrighted videos from being played on it.

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Wednesday, May 7, 2008

The War for the Web

Andy Kessler

Microsoft was smart to walk away (for now) from its $44 billion bid for Yahoo. It’s never good to overpay. But the software giant–whose stock has flat-lined for eight years–was on to the right strategy in looking to the Web for growth. Can’t Microsoft build something on its own? Why the rush to pay billions for Yahoo? The simple (and wrong) answer was that adding Yahoo’s 20% Web search market share to Microsoft’s 10% meant that it could compete against Google’s 60% share. Technology changes too fast for that to make sense except on paper.
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Yahoo Can Find Its Way, But Only if It Stops Searching

Owen Thomas

Jerry Yang’s spin campaign about why the Microsoft bid fell through is transparent. He’s not trying to cajole Steve Ballmer back to the negotiating table; he’s trying to cover his rear and appease indignant shareholders. The only reason he’s so open about accepting a new bid from Microsoft, I think, is that he’s not expecting another one to come.

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Tuesday, May 6, 2008

Why Microsoft Caved. For Now.

Adam Lashinsky

I wrote Friday about the daunting math that Microsoft suddenly faced if it didn’t significantly boost its stake in Yahoo. In short, though Yahoo insiders and generally supportive institutions control less than 40% of Yahoo’s outstanding shares, they easily control a majority of shares likely to be voted in a hostile proxy contest. Average Joes rarely vote in such fights, boosting the power of the pros. Why Microsoft’s bankers at Morgan Stanley didn’t figure this out sooner–or why CEO Steve Ballmer didn’t listen–is one of the intriguing tales that may yet be told. As of the opening bell Monday morning, however, the math changes immediately …

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Monday, May 5, 2008

Calculating the Value of a Failed Merger

Andrew Ross Sorkin

That sound you hear is the whoosh of nearly $42 billion disappearing from mergers league tables.

When it was announced Feb. 1, Microsoft’s blockbuster offer for Yahoo landed like an asteroid on the deal landscape, terrain made barren by the credit market’s drought and the quakes of the slumping economy. Depending on one’s definition of “tech deals,” the unsolicited offer was the largest-ever.

No more (at least for now). Richard Peterson, an analyst with Thomson Financial, calculated the damage Microsoft’s withdrawal will do to the league tables tracking mergers and acquisitions.

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Will Investors Punish Yahoo?

Dawn Kawamoto

Now that Microsoft has withdrawn its unsolicited buyout bid, Yahoo investors who are outraged and seeking to extract some pain may gear up to engage in several actions, ranging from gunning for a board seat to voting “against” re-electing the company’s slate, say proxy solicitors and M&A attorneys.

Eric Jackson, a Yahoo shareholder activist, falls into both camps. On Sunday, Jackson said he’s planning to launch a “withhold vote” campaign and hopes to run for a board seat when Yahoo holds its next annual shareholders meeting.

“I’m definitely interested in throwing my hat in the ring, if it’s allowable, and plan to talk to other shareholders,” said Jackson, founder of hedge fund Ironfire Capital. “And whether it’s me or other people who get elected, that’s fine. Yahoo’s current board definitely needs new blood.”

Yahoo, which has yet to set a date for its next annual shareholders meeting, has all 10 board of director seats up for re-election to a one-year term.

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Yahoo’s Microsoft Bid Rejection Raises Larger Corporate Governance Questions

Dan Braem

Yahoo CEO Jerry Yang will be slammed in the media over the next coming weeks. In my opinion, the criticism will be well founded. It is very tough to make an argument that Mr. Yang is acting in the best interest of his shareholders in rejecting Microsoft’s buyout offer. Personally, I can’t wait to see how long it takes the share price to reach $33. Good luck, Mr. Yang.

The MSFT/YHOO situation triggers deeper questions as to corporate governance in America. More specifically, what can regulators of U.S. companies enact that will allow shareholders to actually become owners of the companies? Here are some of my thoughts:

1. If the boards of directors are to remain truly independent, how is it that the leaders of the boards can also run the companies?
2. How many CEOs or directors of public companies serve with each other on more than one company’s board?

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Sunday, May 4, 2008

Why Yahoo Should Go Ahead With Google Outsourcing Deal

Henry Blodget

Yahoo’s search partnership with Google played a major role in allowing the company to fight off Microsoft. By offering the hope of immediately higher cash flow, it should also stop Yahoo’s stock price from falling back to the teens.

In his sayonara letter, Steve Ballmer urged Yahoo to kill the partnership, arguing that the engineers behind Panama were one of the main reasons Microsoft wanted to buy Yahoo and that, if Yahoo did the deal with Google, they would leave.

And he’s right: They will (or at least they’ll move on to other projects). That’s part of the reason the outsourcing deal makes sense: It allows Yahoo to focus on businesses it can win, instead of throwing money at a war it has already lost.

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Microsoft to Yahoo: Take a Hike

Om Malik

A few days ago I had pointed out that Microsoft’s bid for Yahoo was a checkmate kind of a move: Yahoo couldn’t win from this attack. Today, by pulling its bid for the Sunnyvale, Calif.-based search company, Microsoft proved that again, and showed why it is still the Prince Machiavelli of Technology.

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How Will Yahoo Heal After Microsoft Walked Away?

Robert Scoble

Yahoo is a bleeding animal. Left lying, gasping for its breath, after a larger animal (Microsoft) struck and then walked away after it proved too difficult to eat.

How will Yahoo heal?

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Who Will Microsoft Buy Now With the $50 Billion Change Left? AOL? Facebook?

Rafat Ali

Despite the fact that Microsoft has withdrawn its offer to buy Yahoo, the M&A machinery on all sides is still in full gear, and expect tons of activity in the next couple of months. The $50 billion or so that Microsoft was willing to spend is the money that’s still around, at least on paper. So who will Microsoft buy to make that leap it so hoped for?

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