CNN/WSJ: Microsoft In Talks to Purchase Yahoo?

[Brett_Tabke]

[money.cnn.com...]

Microsoft has been in talks with Yahoo! about potentially acquiring a major portion of the company, according to a report published Wednesday.

Members of the company's top management are considering a deal despite Microsoft's history of winning over major technology markets - think Web browsers - on its own, The Wall Street Journal said.

---

Reuters [in.today.reuters.com]

Although talks over an equity stake do not appear active, Microsoft's top management remains open to a deal with Yahoo as pressure grows from shareholders to perform better against Google, the newspaper cited people familiar with the situation as saying.

[Vishal]

Wow

So suppose if MS just buys Yahoo, it also gets all existing search patents owned by Yahoo, and not to mention yahoo also owns (Altavista, HotJobs, Overture, Inktomi, & few other smaller portals).

[indigojo]

Wow!

would make sense really.

M$ Mkt Cap: 243.20B
Yahoo Mkt Cap: 46.65B
Google Mkt Cap: 118.71B

[mack]

Man this would set up one hell of a battle! between Google and MSN.

Wonder how this will effect GOOG in the short term.

Mack.

[walkman]

not good for Google, no matter how you put it. Even if the "win" eventually, they will come out bruised. Seems like Bill is back in fighting mode.

who's search technology would they keep? If they kept Y's, that would suck, as one of my better sites is banned for something I did 7+ years ago.

[yoo_daa]

This is indeed BREAKING NEWS.
If you look at the big picture this could (and should!) be interpreted as a recognition of Google as a trust worthy opponent and a huge threat. It kinda reminds me of a title of an old Harrison Ford movie that would wrap up the situation on Microsoft looks at the situation – “Clear and Present Danger” - we have to do some drastic measures right NOOOWWW!

[surfin2u]

Nielsen/Net Ratings reported that Google had 49 percent of the U.S. search market share in March, while Yahoo had 22.5 percent and MSN Search had 11 percent.

I think Google could handle the combined efforts of Yahoo and MSN and continue to dominate.

[Vishal]

Well not to mention MS should be out with new OS by the end of the year (hopefully) and new IE will have search box within the browser and I am sure everyone could guess where that search results will come from.

MS don't really need to make their search much better than Google, but just need to be make it 'good enough' and you will notice many people would rather just use the broswer search box than having to visit www.google.com

I personally don't think most internet users are in love with their favorite search engine, they are using it cuz it is there and provides results to satisify them, so if MS makes users search journey one step less and provide satisfactory results, there will be a big shift in search market share.

Vishal

[Receptional]

Indeed, this is news!

Mind you - it's going to annoy all those people at Microsoft who have spent the last two years sweating Blood and tears to build ad center and their search engine.... both could be dead in the water!

That's big business for you.

[davec]

If it came off it would surely be one of the biggest stories of the last few years.

Personally I'd be happy to see it happen and have 2 parties who could genuinely compete (particularly on the advertising side) which doesn't seem to be happening at the moment.

d

[GameMasterM]

It seems only logical if you are going to call it a search war any longer. Google owns the battlefield right now indeed the empire.
I can see Semel buying the idea with a giant payout. Gates steals the headlines for the next few months and Google will be reduced to playing defense for the first time in their history.
Schmidt vs. Gates head on? No brainer.
This could be fun.

[dauction]

Which scenerio best fits:

MSN buys Yahoo and disables Y serps and replaces it with MSN's serps

MSN buys Yahoo and disables MSN serps and replaces it with Y serps

MSN buys Yahoo and integrates Y serps into MSN serps

which algo do they go with or do they mesh the 2

[steve40]

BIG BIG News

I suspect MSN will not give a rats which search they end up using this is all about the % share of online community , This is surely more about opportunities for placing adds infront of visitors and will turn into old fashioned rating war as per TV share long term ( the higher market penetration the better the add dollars earnt ) .
More interesting than which will be the search results is who will provide the advertising , anybody know of Yahoo market penatration in fareastern markets

If MSN buy Yahoo they are ramping up even more than many of us thought and have been very canny

1 Forced Google to overpay for AOL share
2 New IE7 good enough that may stop Firefox continueing to gain market share AKA Google default search and released in "beta" early and significant share gained very quickly
3 New VISTA OS and Apps coming out late 2006 - early 2007 much more integrated to Internet suprise suprise Microsoft view of the internet
4 Bid on Yahoo after much of Google cash committed to AOL and other projects so keeping the bidding war to a minimum

This will be a war that will be decided with good old fashioned cash and how far the city will go for the 2 giants
Google current internet business model works and well proven with high profits also ( still young and hungry ) plus a couple of important aces in the hole very strong working relationship with SUN and The public perception is Google - Search
Microsoft very cash rich with desktop OS and APPS dominating the user desktops and just now entering the internet full force ( older established but still seems hungry )

steve

[yoo_daa]

Guys, with all respect on the comments regarding the consequences to the search industry, that’s what occupies me primarily and I totally agree with you on that specific matter. But I also believe that we have to step back and look with much wider eyes, so that we can see WHOLE picture. This move by M, as I mentioned above, is not only motivated by what’s been going on at search market alone and the success Google have had there. It’s motivated what G has been doing on almost all the other “battle fields” lately. Among others attacking the very hart and the stronghold of the Microsoft desktop arena and trying to push it out to a new playground, on the Internet. Just notice all the new apps/services that have been popping up lately, its amazing. And it’s NOT only the number of them, but the significant new way of developing them, open in the public with our help. Not with specialist looked into some secure bunker below ground. It’s a paradigm shift ahead and M knows it.

Perhaps I’m being paranoid, at least I know Gates is, but don’t you agree that this was the last thing one could expect. This would never have been “flagged” if there wasn’t for some heavy dark clouds on the horizon, swiftly approaching the M headquarters.

[legallyBlind]

There is no better time for MS to attack than now. Google is running out of hard drive space to store our websites but they still have enough to give everybody 1 gig of free hard drive space on Gmail.

I'm going to fix some popcorn sit back relax and watch the show.

[dauction]

I can see how this can work to Googles advantage ..

The reason that some people xx% use Yahoo is they hate MSN .. MSN buys yahoo and loses that percentage to Google

MSN is larger but Google has gained Market share from the merger from those disenfranchised with the changes

So instedd of Google 50% Market Share
Yahoo 26% Market Share
MSN 14% Market Share

It now becomes for example

Google 60% Market Share
MSN 30% Market share

and all the others SE's the loose change

[Vishal]

The reason that some people xx% use Yahoo is they hate MSN

I am sorry, as I tend to disagree with that, however still would like to hear what makes you think that.

[steveb]

MSN wouldn't buy some of Yahoo if they intended to keep their own search.

No doubt MSN recognizes their search product is an abject failure that concerns Google not at all. Yahoo originally got to where they are by combining all the lousy search products out there, coming up with a slightly above lousy product. Now the two lousy products could combine again and maybe come up with a slightly less lousy product, assuming they build on Yahoo's greatly superior conceptual approach to search (even if they don't fulfill the concept very good at all).

It may be big news, but until either Yahoo or MSN come up with an even adequate search product, there is no news here. Google is imploding all over the place and these two are lucky to even find their socks in the sock drawer every morning.

[walkman]

>> MSN wouldn't buy some of Yahoo if they intended to keep their own search

market share, their best engineers, and of course overture.

[elguiri]

Does this mean we might have to carry on using that crappy Overture interface?

[TypicalSurfer]

Believe it or not MS would probably be kinder to webmasters, they don't need to squeeze every last penny out of search, Goole on the other hand will slit your throat over PAID LINKS, a bunch of crooked kings.

I don't have a problem with restoring democracy to the web.

[drall]

If you think for one second Bill Gates is going to be kinder to webmasters you obviously have not seen the tens of thousands of companies he has utterly destroyed with zero regard over the last 15 years.

[TypicalSurfer]

If you think for one second Bill Gates is going to be kinder to webmasters you obviously have not seen the tens of thousands of companies he has utterly destroyed with zero regard over the last 15 years.

lol

google has accomplished that in much less than 15 years. In case you don't get it, G$ sees webmasters as adversaries. Advertisers are frequently blind sided by G$ shenanigans as well. I really can't think of a more arrogant company.

[Marc_P]

I must be some sort of nostradamus, that was my main prediction for 2006:

<edited>

[edited by: tedster at 3:32 am (utc) on May 4, 2006]

[pontifex]

After i saw what Live does, riding the AJAX horse, in Boston on the Super Session, I thought: they technologically locked in fancy nonsense... (remember push media?)

I was preaching in various posts, that MS should buy another player, a player who has some staff on board who knows the game better!

Now that... funny :-) I would have gone a more risky way with smaller guys like Gigablast, but hey, if you got more than 30 Billion in cash - think BIG ...

P!

[walkman]

>> I must be some sort of nostradamus

I doubt it. Nostradamus predicted that dropping urls on WebmasterWorld will not be allowed

[Marc_P]

I can't edit my post to remove the url. I know the rules, I just never had to think about whether or not my contributions here were against the TOS. I don't go around dropping URLs, you know. Anyhow, I sincerely apologize if I the link makes an editor work for nothing :-(

[mcavic]

MSN wouldn't buy some of Yahoo if they intended to keep their own search.

I disagree - they might buy it just to shut it down. It might be a waste of money, but I'd believe it.

No doubt MSN recognizes their search product is an abject failure that concerns Google not at all.

That's very possible too. But as I've said before, there's enough room in the marketplace for two or three leading search engines. So MSN Search doesn't really concern me, regardless.

I'm much more concerned about what Microsoft does with Windows. I think that's where their next antitrust suit lies, perhaps after the release of Vista.

[walkman]

Marc,
sorry.
I was teasing you...thought about not doing it, but it was too good, at least I thought so, not to :)

[tictoc]

This could also be a stunt to raise the Mr. Softy share price while MS is doing nothing. MS is good with making sure their price does not tank too badly. I think its a PR stunt for now...