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Posted by David Drummond, Senior Vice President, Corporate Development and Chief Legal Officer
So Microsoft's hostile bid for Yahoo! raises troubling questions. This is about more than simply a financial transaction, one company taking over another. It's about preserving the underlying principles of the Internet: openness and innovation.
Could Microsoft now attempt to exert the same sort of inappropriate and illegal influence over the Internet that it did with the PC? While the Internet rewards competitive innovation, Microsoft has frequently sought to establish proprietary monopolies -- and then leverage its dominance into new, adjacent markets.
[edited by: Marcia at 8:20 pm (utc) on Feb. 3, 2008]
I'm not so sure how they will use Yahoo tech to exert dominance though - it is harder to "tie in" web users in the same way as an OS. At best yahoo is going to become a support for MS's version of Adsense, but this will only be useful only as long as Yahoo remains a SE leader; even there, MS will have problems "keeping up", as Yahoo leads Google only in Asian countries. Or are these the intended target?
[edited by: Josefu at 9:52 am (utc) on Feb. 4, 2008]
Google Inc. Chief Executive Eric Schmidt called Yahoo Inc. CEO Jerry Yang to offer his company's help in any effort to thwart Microsoft Corp.'s unsolicited $44.6 billion bid for Yahoo, say people familiar with the matter.
Google Offers to Help Yahoo Fight Off Microsoft [online.wsj.com]
Yahoo already had been in negotiations in recent weeks to outsource its Web-search advertising in Europe to Google, say people familiar with the matter. Since last year, investors have called for Yahoo to abandon its own search advertising system, which generates significantly less ad revenue for each consumer search, and use ads from Google in return for a majority share of the revenue.
[edited by: Marcia at 4:02 am (utc) on Feb. 4, 2008]
It's about preserving the underlying principles of the Internet: openness and innovation.
Talk about calling the kettle black.
Perhaps Google can explain that 'openness' to the people of China. Google caved to the communist government and censored search results for the sake of profits.
Reporters Without Borders, a France-based group that defends freedom of the press, blasted Google, saying the company was taking an immoral position that could not be justified.
"By offering a version without 'subversive' content, Google is making it easier for Chinese officials to filter the Internet themselves. A Web site not listed by search engines has little chance of being found by users," the group said in a statement. "The new Google version means that even if a human rights publication is not blocked by local firewalls, it has no chance of being read in China."
Google censored its news site in China, removing material banned by the authorities.
The French advocacy group reports that at least 20 blogging services, including Yahoo!.cn and MSN.cn, have agreed to the new "self-discipline pact" laid down by the Internet Society of China, a spin-off from the Information Industry Ministry. Under the pact, the services are encouraged to store the real names and contact details of Chinese bloggers and delete "illegal and bad" information from user comments.
I expect that the conversation went something like this (in all cases)..
China : Please removes sites x, y and z from your index, we do not like them.
Google : No way! we are all for free speech and do no evil..
China : OK - we will block you at the great firewall and we will also take over google.cn and redirect it to our 'internal' search engine.
Google : Errrr..... Well just this once
Their statements about Microsoft cannot be taken seriously, but there's more to this than meets the eye. With the recent decline in GOOG stock price, they may be getting a little desperate in terms of self-preservation.
Their record profits cannot continue indefinitely and they may be aware that a day of reckoning is coming that would reduce their share price to a "reasonable" - as opposed to absurd - $200-250. Such a decline would be devastating in terms of the buying power of their stock for both attracting talent and making acquisitions.
I actually find it rather amusing that Gooffle gets their hair up whenever there's a threat - real or perceived - to their search monopoly.
If someone told you that they were going to kill you, and that they have killed people before and will do it again. This person is very rich and powerful and can do what they say without a problem from the law.
Wouldn't you be a bit freaked out every time they moved in your direction? :)
If you read their financial reports you will see they are openly afraid of losing marketshare, as they should be because there is little lockin.
Wouldn't you be a bit freaked out every time they moved in your direction? :)
Sure, I would, but that doesn't mean I can't find Googie doing it amusing. It really does show how fragile their business model is, doesn't it?
... and they often act so almighty and powerful when dealing with "lowly peasants" like webmasters who have to abide by their guidelines and can't know anything about how their algo works or why adsense revenue fluctuates so much.
I think the Microsoft-Yahoo marriage would be good for the internet community as a whole, as it would keep Goog a little honest and improve competitiveness, though a few more SEs in the mix would be even better.
Do you think they will tell you exactly how they calculate revenue and provide a hotline for anyone who thinks their earnings are below what they should be?
How will things be any different at all?
The thought of Microsoft keeping anyone honest is laughable.
Yet now they seem to be allowed to merge their search engine, their mapping software, their community building efforts, ... (all sorts of things where they -fortunately- do not dominate yet in any way) with one of the bigger players in those areas.
The bid of MSFT should be outlawed.
With all their web properties (search, Adsense, Youtube, Blogger, Urchin, Maps) they have drilled themselves so deep into the web, that it almost looks like cancer. There are very few sites you can visit without Google actually tracking you. And now Google pulls the lame card of calling Microsoft a "monopolist"? Laughable, and embarrassing for a company like Google. ("Whiners!" was my first thought.)
Sure, Microsoft once was a monopolist (and still is when it comes to operating systems). But Google is far more dangerous than any company out there. Google's success has fueled a self-understanding of being invulnerable, but the recent drop in stock price shows that investors are waking up finally. All of a sudden you see "downgrades" from analysts, who also have found their voice again.
I do not have much hopes for Mahoo! to create "a better web", though. What would that be? All I am hoping for is more competition for Google, so that they will be kept "in check" by someone. Maybe this market pressure makes Google re-think their customer service strategies (if there is are any), or the way they treat webmasters.
Sure, Microsoft once was a monopolist (and still is when it comes to operating systems).
What about office products and instant messaging software? What about server side collaboration/email software?
Your definition of monopoly seems to be having > 50% of the market and is dependent on your opinion.
I hate to break it to you but Google is not a monopoly and it is easy to avoid its 'evil'. Just block their servers at your firewall if you do not want to be tracked. On the other hand it would be hard to avoid Microsoft from spying on you.
The only company convicted multiple times of abusing a monopoly is Microsoft. Google does not even have a monopoly, they are a long way from being an abusive monopoly like Microsoft.
Just search live.com for "Google monopoly abuse" and then search for "Microsoft monopoly abuse". You might want to try google.com actually, I hear they make a better search engine.
Google's user tracking abilities are evil.
Microsoft once was a monopolist
E.g.: in the EU they are forced to sell Windows without a media player included (and have been fined huge amounts for refusal to comply). Yet there is nowhere any such copy to be found cause they sell it for the same price as the one with the player included. I'm sure due to their volume discount maze, the version without will cost actually more to the merchants to make sure they'll never have to have any sold.
World rejects OOXML as a proper standard... whine...
Google to acquire DoubleClick...whine...
Microsoft fined by the EU for abusing their monopoly...whine...
I wouldn't even go so far as to call it monopoly; it's actually just a huge percentage of market share. There's an enormous difference between monopoly and popularity.
Google became popular because of becoming "the people's choice" for search. And then, with the increased visibility, the level of appeal to advertisers was bound to increase accordingly.
Google did nothing to stifle anyone else; all they did was grow - and that by popular demand, and by the way the open marketplace works.
As a matter of fact, yes. And the MS Office suite as well. Prior to Windows, companies had all different kinds of software that was costly in terms of having to train existing and new employees, as well as high purchase prices; and DOS was arcane enough to be beyond the average user.
Windows and MS Office came along and were intuitive to use, with the learning curve short enough that the "average" non-techie could master it in a matter of weeks. That made it easier for normal, non-geek people to acquire transferable and portable, high demand and marketable job skills, and far easier for companies to standardize and find qualified help.
That's exactly the same reason Linux hasn't and won't equal the popularity and widespread usage of Windows and Windows-compatible software applications.
>>does that popularity thing also apply to windows
As a matter of fact, yes.
MSFT has over the years multiple times being openly accused by PC vendors of being forced to include OEM licenses with all of their products sold. If they refuse to play they get to pay the licenses from MSFT much more expensive.
[Such practices are illegal where I live]
So that leaves those who do not want to pay for windows with no choice: they will pay, even if they do not intend to use the license cause they prefer something else/better.
This doesn't stop the well-informed, but the grey masses only see one option.
Even back to be beginning of the PC, IBM had actually had two competing options for operating systems: PC-DOS (licensed from Microsoft, who at the time were mostly known for their flight simulator game and their BASIC interpreters) and CP/M-86. IBM had trouble with the licensing agreements of CP/M-86 and pushed PC-DOS for a while, enough to do the damage. CP/M-86 was -by far- the more powerful choice, and the lack of basic provisions in the "clone" that Microsoft made was enough to set back development with decades. If you don't believe PC-DOS was a set back: try using PC-DOS 1.0 and any version of CP/M for the 8086 cpu, if you find a machine capable to boot them. But I guess it's like complaining that VHS won over betamax.