Saturday, February 02, 2008

All you Yahoos belong to me now!

On and off, the rumors came and went with the wind over the years. "They're in talks," for all we know comparing what jet is great to buy. For all the years a merger between Microsoft and Yahoo! had been whispered, it was always in the realm of wishful thinking like fanboys day dreaming of the day Apple would buy Sun.

The litany of why a company should and ought to buy another is a long list of pros and cons.  One thing that has always struck me is the similarity between Microsoft's and Yahoo's approach to solutions. 
Take Yahoo Mail, it is cumbersome and slow compared to the sleek cleanness and efficiency of Google's Gmail. Their home pages--- a reflection of what they value most. Yahoo's more media-centric, everything bit of thing is here in contrast to Google's minimalist one search box, quick to load page.  Yahoo is more tabloid than Google's more newspaper elite.
In the same vein, look at Microsoft's Windows XP/Vista--- great for general purpose use, for the unwashed, the plebs plebis. Pop open XP/Vista's command line and you'll find it sorely lacking in tools out of the box like secure shell. Sure there's putty, but you'd never have to have it if Microsoft would just include ssh by default. Not that the majority of people using computers would mind or ever need it or want it.  Contrast with their competition (putting aside the Linux folks), Apple has included secure shell in OS X. Windows is more ordinary, like a midrange car, while OS X is more what a car should be. 
Yahoo's and Microsoft's approach and philosophy in making things is that "it's great to cobble things together and make it work, never mind if it's ugly as long as they get money". Contrast to the efficient and perfectionist and often elitist approach by their rivals Google and Apple.  You can see how easy it is to get into a religious Crusade-level kind of war, "my Yahoo is bigger than your Google" contest or "OS X is better than Vista" that is the hallmark of message boards for what would seem like forever.
One great reason why Yahoo hasn't skyrocketed over the years is really the way they approach their business and how everyone perceives them to be. They've had an identity crisis since day one. They act like a Search Engine company, and everyone treats them as such when in fact, they're a New Media-Social Networking company. Perhaps the very first one, ever. They've got news, groups, mail from the get go.  One might argue it was social networking way before the term "social networking" was coined. Yahoo's is doing for the masses in the 21st what newspapers did for the masses during the 20th century. 
Contrast that to Google's laser-focused approached to their business: "we're all about organizing the world's information". Need something?  you know your first place to be is go visit Google. Everything Google does really well is centered around search and organizing information. Everything else they do on the side, always takes a backseat to search.
Parallel that to Microsoft, a company that identifies itself as an operating system company and as an office company: Windows+Office. They never were just an Operating System company or a company that made Office software--- though that is what they're famous and became rich for. They were a software development company. Today, Microsoft is a conglomerate not merely a technology company. 
It's not to say that being perfect for one another makes this whole takeover bid any easier. Remember: Time-Warner and Compaq+HP marriages. In recent memory, ATI+AMD's marriage was logically sound. It looked reasonably good on paper like a great gamble--- perhaps it was the only way for AMD to survive the juggernaut that is Intel and for ATI to survive the inevitably dying GPU business. Yet all those marriages remind us how such mergers, in less hostile bids typically end up--- damaging at best in the short term and a whole lot of grief going long.  
That's of course not to say that there are no good marriages in the corporate world. One marriage comes to mind: Disney and Pixar has been bliss. 
In the most optimistic scenario, Yahoo would accept this shotgun marriage proposal as would the regulators on both the American side of the pond and the European.  It would be good for the shareholders, after all.  For consumers, nothing much would change--- at least not overnight. You just can't unplug all those BSD servers and PHP code and migrate them to Windows Servers and .Net, if ever Microsoft would ever want to do that, which they probably will going forward. It would be a long while (a year at the very least) to consummate the shotgun marriage of Microsoft and Yahoo, dotting all the "i" and crossing the "t". A year is a lifetime on the Internet and that distracting time could be better spent focusing on Google and way lot of time for Google to keep on doing what it is doing right now.
This whole Microsoft-Yahoo (nice name, by-the-way) marriage may not be a done deal but Google must be thrilled at the prospect their number two and number three competitor are way too distracted with this marriage business.  If history is to be a benchmark, corporate marriages even with the best of intensions is hardly good for the companies involved.  Personally, I'm all for this--- it would spice things up, if only for awhile.  And maybe at the end of the day, Yahoo would finally be laid to rest, with only our memories what it could have been. Who would have thought, I'd be rooting for Ballmer screaming at Yang "All you Yahoos belong to me now!"?


DJB Rizalist said...


Internet must be real now, I reckon!

Cocoy said...


Cocoy said...

interesting thing to note though Marketwatch says Microsoft may not have enough money for the deal:

"Can Microsoft really afford it?
Not as easily as one might assume, given that the company is legendary for hoarding cash.

Microsoft says it will pay as much as $22.3 billion in cash to close the deal, though the company reported having just over $21 billion in cash and short-term investments on hand as of Dec. 31, according to regulatory filings.

Wall Street analysts have therefore suggested Microsoft may have to take on some debt to close the deal -- particularly if Yahoo attempts to hold out for a higher price."