Hunter Strategies LLC logo

Microsoft News Tracker

What's more interesting than observing Microsoft?

June 14, 2008

Microsoft postscript to second round of Microsoft-Yahoo acquisition talks

Posted by David Hunter at 9:10 AM ET.

Apparently feeling a bit bedeviled in the coverage of the collapse of the second round of Yahoo acquisition talks, Microsoft revealed the details of their proposed "alternative transaction" via a memo to employees from Kevin Johnson, president of the platforms and services division, which was promptly leaked to the press. The gist:

Microsoft projected that this deal would  increase Yahoo’s annual operating income by more than $1 billion above its current level although some of that depends on the cost savings of shuffling the search hardware, employees, and operations off to Microsoft.

I suspect that while the money is important, the real sticking point is that the Microsoft deal has Yahoo merely displaying a "white label" search service provided by Microsoft, while the Google arrangement leaves Yahoo in control of their search service and merely dealing with Google for monetization. In many ways, search is just another form of content and if Yahoo has a new determination to succeed in the content business, selling a major chunk off to Microsoft is a poor way to start.

Filed under Acquisitions, Coopetition, Executives, Google, Kevin Johnson, Microsoft, Yahoo

Related posts:


2 Responses to “Microsoft postscript to second round of Microsoft-Yahoo acquisition talks”

  1. James Fry Says:

    I think Microsoft’s point is that if Yahoo outsources to Google they might as well sell their search franchise. The end result is the same – Yahoo is out of the search business. It’s just a matter of time.

  2. David Hunter Says:

    Perhaps, but it wasn’t that long ago that Yahoo was serving ads on MSN search while Microsoft got its search ad system together.

News Search:

Recent Posts:

Daily Digest Email:

Enter your Email

Powered by FeedBlitz


Full category list


Archive List

RSS Feed:

HunterStrat Links:


  • Powered by WordPress.