Microsoft-Yahoo

Yes, I know Yahoo rejected Microsoft's bid of $31 per share. But that's just standard negotiating strategy in the world of mergers and acquisitions.

Sure, Microsoft's offer - a 60% premium over the price of Yahoo's stock at the time - was designed, not only to get Yahoo's board's attention, but to back them into a corner. If no other suitors emerge - as I predicted in a prior post - it's an offer Yahoo's board can't refuse without risking shareholder litigation or revolt.

But that doesn't mean Microsoft didn't leave itself any wiggle room, and Yahoo's board knows that. They also know that this is Microsoft's big chance, perhaps its only chance, to jump to number 2 in internet search and advertising and challenge Google. That means Yahoo has some negotiating power.… Read more

While Microsoft and Yahoo do the M&A dance, a big question lingers: which parts of Yahoo would survive if the deal were to go through?

Microsoft Chief Executive Steve Ballmer has said if his company's proposed acquisition of Yahoo goes through, the Yahoo consumer brand would live on, which could be the death knell for MSN. Microsoft has said Windows Live and Office Live brands will likely stay, but Windows Live could be winnowed down.

The brands have different strengths in different regions. While they jockey for second place to Google in the U.S. market, Yahoo … Read more

The day The 404 went insane. Today's show with guest David Carnoy gets out of hand real fast. First we talk about the Grammy's--specifically Amy Winehouse and Kayne West. Then, after the break, all hell breaks loose. Enjoy this rare episode while you can, because something like this probably won't happen again.

Listen now: Download today's podcast

Although I wasn't planning on writing this column for at least a few months, it looks like the recent developments in the Microsoft-Yahoo merger have precipitated my need to do just that.

Allow me to say with total and utter certainty that Microsoft never wanted this deal with Yahoo and was using it to gain important information about the company before it was forced to drop billions of dollars on an acquisition that almost everyone knew was tenuous, at best.

But unfortunately for Microsoft, its plan backfired and now it's left with nothing to show for it.

Of course, the real goal all along was to initiate the acquisition phase of the deal, perform due diligence tests to see what sort of technology Yahoo employs and what it has in store for the future and once the Department of Justice found problems in the deal, back out.

Don't believe me? Look no further than Microsoft's attempted deal with Intuit for all the proof you need.… Read more

Juan Ponce de Leon came to the Americas in 1513 searching for the fountain of youth. He never found it, but he apparently left behind the belief that old bones can be rejuvenated, as Microsoft seems to be chasing th same elixir with its proposed acquisition of Yahoo!.

While there are clues that pockets within Microsoft are embracing the web and its promise, Microsoft is currently $80 billion into its quest for the Yahoo! Botox with little to suggest that the company is truly read to embrace what is most disruptive - and most successful - about Yahoo!.

There are also questions about whether Yahoo! is the ideal teacher for Microsoft, as The Guardian notes:… Read more

Yahoo's board has decided Microsoft's $31-per-share offer "massively undervalues" the company, according to a report in The Wall Street Journal. Yahoo is expected to formally reject Microsoft's offer, the Journal reported.

In the report, it appears Yahoo is floating the idea that it might consider an offer of at least $40 a share. I'm not in the boardroom, but all of this--the leak, the wording--sounds like more of a negotiating tactic than a final rejection.

But, if Yahoo does want to play hardball, it has bolstered its position. The report says that Yahoo has … Read more

Microsoft says it can find $1 billion in cost cuts by combining Yahoo's business with its own Internet services operation, however CEO Steve Ballmer says the Yahoo name isn't one of the things on the chopping block.

"Yahoo, the brand, will live," Ballmer told BusinessWeek.

Even if the brand lives, though, it is unclear which of Yahoo's technologies Microsoft would adopt. A merged company would have to choose among two e-mail systems, to ad platforms and two instant messaging systems, to name just a few of the many overlaps.

Microsoft has thus far offered few … Read more