Still, a joint Microsoft-Yahoo would from Day One be a formidable player in display advertising and mobile Internet services, he said. Ever since the first rumblings about a possible acquisition of Yahoo by Microsoft, events have gone downhill for Yahoo -- including several reorganizations and management shake-ups -- so the deal appears more plausible today, Sterling said. At the same time, despite considerable investments, Microsoft hasn't made as much progress in search engine advertising and usage as it had hoped, he said.
A combined Microsoft-Yahoo would improve the companies' respective positions in the search market but still wouldn't top Google, which has a dominant lead both in search engine usage and advertising, he said.
Brad Smith, Microsoft's general counsel, said Google's market lead should prevent it from trying to best the buyout offer announced today. Google is "not in a position to do this" because of antitrust laws, Smith said — an ironic comment by a Microsoft executive, considering that company's ongoing antitrust issues in the U.
Todd R. Here are the latest Insider stories. Ballmer said that Microsoft has been in "off and on" talks with Yahoo for 18 months and said he called Yahoo CEO Jerry Yang Thursday night to tell him the bid was coming.
A Microsoft-Yahoo combination would create a powerful number two player in the online search business, which Google commands. Microsoft announced the bid early Friday. In a statement, the company said the offer allows Yahoo shareholders to elect to receive cash or a fixed number of shares of Microsoft common stock, with the software giant's offer consisting of one-half cash and one-half Microsoft common stock.
In a statement, Yahoo acknowledged receipt of the offer and said its board would evaluate the proposal "carefully and promptly. Yahoo's earnings and share of the online search market have badly trailed Google. Google reigns over The combined forces of Microsoft and Yahoo would also make a stronger force in online display advertising - the type of targeted banner ads that Yahoo is known for.
In a letter it sent to Yahoo's board of directors, Microsoft disclosed it had explored a Microsoft-Yahoo deal a year earlier, only to be rebuffed by Yahoo, which said at that time it was confident of the "potential upside" for Yahoo from operational changes it planned. Ballmer, in the past, has historically not loved these types of deals.
It is indicative of how different the world is now. Gartenberg added that the deal "absolutely" makes sense. Getting this deal done might be the easiest part. The real challenge is what happens when they finish the deal. This is not a panacea--the details will be what matters," he said.
Rumors that Microsoft was interested in Yahoo have bubbled up from time to time, including the past two springs, on the eve of Microsoft advertising conferences. The move would be by far the largest acquisition ever for Microsoft. Asked on the conference call why Microsoft still needs Yahoo after buying Aquantive, Ballmer pointed to Yahoo's reach with consumers.
Microsoft also pointed to the intense investments needed in data centers and technology needed to compete with Google. Unlikely, perhaps - at least here in U. Update: Yahoo mulling offer. While Yahoo stockholders will likely be popping champagne corks this morning, the rest of us ought to be taking a considerably more sober approach to the deal and its implications.
Let Redmond choke on it, you might say. On the other, this just can't be good for competition, consumers or the Internet - no matter the obligatory this-is-for-our-own-good spin being put on the deal by Microsoft.
From the press release :. Let the shareholders decide that question for themselves. I'd be skeptical if I owned Microsoft stock. As for customers and industry partners, there's little good to see flowing their way from this deal.
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