Wednesday, July 29, 2009

Yahoo's last hurrah?

AP has a good article on the long-delayed Microsoft-Yahoo search agreement. (Great title on Yahoo Tech: “Microsoft, Yahoo team up to ding Google with Bing.”)

Yahoo gets no up front cash, but gains incremental revenue and reduces search R&D. (It’s not clear if the claimed $500m increasing in operating profit includes the R&D cuts).

Many commentators say Microsoft got the better end of the deal. Perhaps the most colorful analysis comes from Jason Calacanis, founder of Silicon Alley Reporter in his Business Week column:

Yahoo committed seppuku today.

The once-proud warrior of the Internet space laid down its sword, knelt at the feet of Microsoft, and gutted itself today. There was no honor in this death: It was brought about by the shame of losing to Google and a lack of faith in its ability to compete in the space it created. To be clear, Yahoo didn't need to do this deal; Microsoft did. Ultimately Yahoo will look back at this moment as the second—and perhaps fatal—mistake in its epic history.
(Of course, the bigger mistake was helping Google get established in the first place).

Clearly Yahoo’s bargaining power and stock price are far lower than when it turned down Microsoft’s various acquisition offers. He who hesitates is last (and lost). In this case, Carol Bartz is paying the price of the indecision of her predecessors, both Jerry Yang and Terry Semel.


ddadmin said...

Finally Microsoft has reached a deal Yahoo for an internet search partnership. Will the newly announced deal between giants Microsoft and Yahoo be a good thing to them and bad to Google? Got to wait and see. I was just curious to know all the past negotiations between Microsoft and Yahoo so collected all the articles and links (more than 200) related to the current merger and the previous events or negotiations between Microsoft and Yahoo. If you are interested check the link below.

Joel West said...

Wow! That's quite a list of articles. Have you read any of them?

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