More importantly, what are Microsoft's motives in acquiring Yahoo!?
To be honest, I can't figure out what Microsoft is up to with its online strategies. It seems to be losing plenty of money on Bing and is worried sick that Google will somehow steal all its business.
Which brings me to Yahoo! According to reports, Microsoft is going to take another run at buying out Yahoo! And I ask, why?
I never figured out what it wanted Yahoo! for in the first place, when the company was at $35 a share. Now, hovering at around $16 per share, it must look like a bargain by comparison. So it could be that.
But looking at the current iteration of Yahoo! makes me wonder why Microsoft is still interested. It already did a deal to share search engine traffic. What else is there?
Yahoo! has a good e-mail system and a lot of content, as well as excellent groups which all meet up inside the Yahoo! environment. The content is valuable for a lot of reasons.
But Microsoft has long since experimented with content and given up on the idea.
It all started with Microsoft Press, which became a huge player in publishing and then faded. Then in the late 1990s, until the dot-com crash, Microsoft put muscle behind online magazines. There were the usual special interest publications and a computer magazine, all well-produced and presented as state-of-the-art online magazines. The company simply lost interest.
It even pioneered the online "city" magazine with Microsoft Sidewalk, eventually sold off to another party. The company also developed and dumped Expedia.com. It was one experiment after another.
Yahoo!'s content actually pales in comparison with what Microsoft already attempted and failed.
I can assure you that if Microsoft ever got hold of Yahoo! it would end poorly for Yahoo! users employees alike. Microsoft is not mentally equipped to be a player in any sort of content game; it does not have the right view of the world to manage the concept.
Now, Microsoft might just be buying the numbers. The daily usage of Yahoo! is stupendous and the numbers look good on the spreadsheet. Also, Microsoft would acquire the Yahoo! sales folks, who could leverage the ads in Microsoft's favor.
After an initial boost, though, I cannot imagine what good would come of such a merger. Is Microsoft hoping to enhance social networking? Yahoo! has no clue. Microsoft already has an investment in Facebook. Why not ask them?
And which members of the Yahoo! advertising team cannot be bought out by Microsoft? Put a listing on Craigslist, offer more incentive, and it can have anyone it wants. They can tell you all you need to know about the Yahoo! business and how to sell ads for it.
When this deal first appeared, I thought Microsoft was buying a competitor to better rival Google. But with the search engine sharing scheme, it would be buying a partner already in its pocket, rather than a competitor. It's pointless.
Now, all the pundits could be wrong and Yahoo! may have no plans to sell anytime soon. The rumor could be a hoax. Then again, Microsoft might be considering the possibility that Yahoo! could be scooped up by Google or AOL. And if this new landscape would not benefit Microsoft, then maybe that's a good reason for it to buy Yahoo! Self-preservation.
OK, I'll believe that idea.
Copyright © 2010 Ziff Davis Publishing Holdings Inc.