Microsoft (finally) drops bid on Yahoo

Posted by multippt

Looks like Microsoft decided to withdraw it’s second bid (given the results of the first proposal, not many paid much attention to the second proposal) to acquire Yahoo. It’s not that surprising that the bid failed since after all, the second bid was only slightly higher than the first bid (but much less than what Yahoo wanted). This so-called ”hostile takeover” appeared to end with nothing more than a whimper. Well, at least now we know Yahoo is certainly not going to big Microsoft (or perhaps, Macrosoft?).

Sadly, Yahoo will eventually be taken over by someone, or some company. Microsoft will probably come back a third time, or probably much more, hoping Yahoo will eventually say “yes”. Despite Google “helping” Yahoo against Microsoft’s tyrany, it’ll take only time before Microsoft would probably finally get its hands on Yahoo, given Yahoo’s current deteriorating situation (stock market, etc. etc.). Certainly not-so-good news for the Yahoo community.

So what do Microsoft want to do with Yahoo?

There’s one thing for certain - Microsoft will NOT do anything related to search. The primary reason why Microsoft wanted Yahoo was not for Yahoo search or the hundreds of services Yahoo provided. Microsoft simply wanted the advertising portion of Yahoo (plus some other technologies to include in Microsoft’s ever-growing arsenal of proprietary software) since it’s going to be the next big thing that’s going to expand Microsoft’s wallet.

I guess time will tell before we will see Microsoft Yahoo (or Microhoo) in the near future.

Why no Microsoft Yahoo?

The first answer is obvious: Yahoo simply didn’t want Microsoft, and Microsoft now knows that. Given Yahoo’s constant turn-downs on Microsoft’s offer, as well as going as far as making deals with rival Google in relation with advertising (fancy Yahoo actually advertising Google AdSense rather than its own ads). In addition, Yahoo did not release any statement even when the dateline was due.

The community has been pretty neutral about this matter, but there are certainly some people who do oppose the takeover (thereby, calling it “hostile”). Why oppose? With Microsoft Yahoo, we will end up having to pay more for ads. Microsoft would attempt to use Yahoo to inflate ad prices everywhere and anywhere (as part of their “business plan”).

Yahoo rejects Microsoft’s offer

Posted by multippt

Looks like Yahoo decided to reject Microsoft’s offer of $44.6 billion. The deal came surprisingly 1 week ago, and is perceived as “hostile” by many Internet users. The primary reason why Microsoft’s offer was rejected was that its deal is not high enough.

Yahoo also believes that Microsoft is attempting to make use of the recent slide in Yahoo’s share prices to “steal” the company. If compared to 6 months ago, Microsoft’s deal would not be even close to the market shares Yahoo was having. Yahoo is thus very unlikely to accept any offer below $40 a share, which is a lot more than the $31 a share Microsoft is offering.

However, even if Yahoo were to reject the offer, Yahoo does not seem to be in a good position to compete Google. Having lesser funds and talent to compete against almighty Google (a position Yahoo once held until Google came along). Thus, Yahoo is considering other scenarios to keep its independence, such as coming up with an advertising partnership with Google.

Yahoo to decide if it accepts Microsoft’s offer

Posted by multippt

Looks like it’s Yahoo’s turn to decide if it should accept the $44.6 billion deal. The outcome will determine what happens to the search engine community - users, developers, etc. While Yahoo and Google has been actively embracing openess (particularly technologies that are not yet completed), going as far as to making APIs available for free, Microsoft ain’t so active. Rather, Microsoft was seen as shunning openess, prefering to stick to strategies that will somewhat coerce people into using its propiertary technology.

It’s been known that big mergers tend to fail more often, due to the difficulties that arise when merging them together. It’s not easy to get open Yahoo to go with closed Microsoft. However, if Microsoft didn’t buy Yahoo, Yahoo would be facing a lot of trouble from Google. Surely Yahoo won’t want to end up like AOL.

The main point of Microsoft buying Yahoo is not its search capabilities, but rather the advertising. Yahoo is still top at advertising, perhaps maybe until Google acquires DoubleClick. Still, Microsoft + Yahoo will have the overall advantage in advertising Though they still will not be able to compete against Google in terms of search, that is unless Microsoft or Yahoo decides to do something absurd like completely opening up search (or make a lot more information readily accessible), which for years have remained closed-source and restricted despite the presence of APIs provided by Google and Yahoo. Sure, if Yahoo were to do one more step like removing the limits bounded to its search APIs (still considered better than Google’s since they are ad free, and the results can be re-ordered), it may turn the tide against Google.

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Looks like we may need to keep a tab on those Yahoo press releases.

Google criticises Microsoft’s attempted acquisition of Yahoo

Posted by multippt

In response to an (not so) unexpected offer by Microsoft, Google has decided to counter Microsoft’s attempt at becoming a dominant presence on the Internet. Earlier a few days ago, Microsoft offered Yahoo an interesting $44.6 billion to acquire it. Google was playing along silently until 2 days later.

What Google says

“The openness of the Internet is what made Google — and Yahoo! — possible.” - Basically it’s trying to say that Google and Yahoo are very “open” in their approach towards users unlike Microsoft, and has acknowledged that controlling the net is not possible given the freedom of the net.

“Could Microsoft now attempt to exert the same sort of inappropriate and illegal influence over the Internet that it did with the PC?” - Google fears that Microsoft’s takeover will mean that Microsoft will exert monopoly strength and controversy on the Internet as what it has done to computers.

“Could the acquisition of Yahoo! allow Microsoft — despite its legacy of serious legal and regulatory offenses — to extend unfair practices from browsers and operating systems to the Internet?” - Seems like Google is saying that Microsoft is not trustworthy and has resorted to practices that go against fair competition.

You can read all about it from the word of the vice president of Google through their blog.

Google fears 

Though, all these claims, though true, are kind of biased. While Google is trying to inform the public that Microsoft’s acquisition of Yahoo is one that may bring about competition problems (i.e. monopoly and anti-trust), in reality Google is probably afraid that Microsoft Yahoo will be much more formidable than its original opponent, Yahoo. Microsoft has the money, Yahoo has the tech. So, both combined will give them the edge Google will have trouble trying to compete.

Of course… Google can’t simply buy Yahoo

Given Google’s encouragement on “openess and innovation”, Google will unlikely offer up any bid to buy Yahoo, because it doesn’t want to show that it is going against its own words. If Google were to bid for Yahoo, it will cause controversy, because this means Google will be controlling and monopolizing the net. Sure, Microsoft has this problem as well, but in Google’s case it has become an Internet giant unlike Microsoft which has so far been unsuccessful. This makes it all the more harder for innovative Google to acquire Yahoo, especially if it doesn’t want to get hit by anti-trust cases.

Microsoft considers buying Yahoo for $45 billion

Posted by multippt

Seems like Google will be facing a whole lot more competition this time round. While this idea is not new, it is was just speculation amongst webmasters on discussing whether Google will still stay king of the net. Some jokingly said that the only way Microsoft ever get close enough to Google, is to buy Yahoo. This joke has become a reality.

What this means

If this deal is successful, Microsoft will soon find itself into the pages of numerous web surfers around the world. Well, no one can really complain. It’s not like Microsoft is all that bad right? (*Braces self for Windows-related sarcarsm*) Even more importantly, this deal may determine who shall dominate the Internet. Don’t forget that Microsoft had always have an influence over the Internet from the beginning, starting with its Internet browser, Internet Explorer. Microsoft’s acquisition over Yahoo means that Microsoft will have a permanent stake in the Internet. Advertising, search, media will soon have Microsoft’s presence around.

The deal involves Microsoft acquiring Yahoo’s stocks, at $31 per share (i.e. Yahoo is worth $44.6 billion from this offer). Microsoft even added some incentives for existing Yahoo shareholders to make them willing to support the acquisition.

Though, Microsoft hasn’t really mention what it will do with Yahoo, however it does give hints that they will make use of Yahoo’s influence (particularly advertising) and technology (as well as research).

Other offers?

Since Microsoft is offering such a large deal which boosts the value of Yahoo, surely other companies will be more than willing to offer higher prices. AOL may offer up a price. Google might do the same though unlikely, since if Google were to do so, it will face the same problem as Microsoft once did - anti-trust controversy (i.e. monopoly of the search engine market).

The press release

Microsoft has released a formal press release statement on its offer, complete with the excerpt of the letter Microsoft sent to Yahoo.

Who’s celebrating Christmas?

Posted by multippt

It’s nice to see that Yahoo and Google are putting on the Christmas spirit. As usual, Google has plans to create nice doodles for the days before Chirstmas. This is the 4th of the 5 for this year:

While Yahoo decided to go animated with some nice flash effects. A screenshot is shown below:

You can find the 3 here, here and here. Expect one more to come after though.

Even Ask has something to say about Christmas, with a nice template dedicated to Christmas.

There are many other sites celebrating Christmas as well, maybe at least mentioning it. Glad to see Christmas being celebrated online. Sadly, Microsoft (Live and MSN) didn’t really mention much about Christmas, aside from the ads.

Why searching is free

Posted by multippt

We never need to pay for finding stuff online. Searching is an invaluable tool - the most trafficked sites are search engines. Have they ever placed a price tag on search? No. They can’t place a price on it, so the best possible price would have to be - FREE! However, Google and Yahoo still earns billions from search, even though the main service itself is provided at no cost. Though, search itself does grant those who provide it with unmeasureable power - enough to actually counter the fact that searching is free.

Sources of cash without cashing in on search

Making search free completely eliminates the searching part of search engines from the profit list. However, providing other services will make up for it - by a lot. In the end, search engines still profit, though indirectly. However, if Google does charge a fee of $0.01 per search, it will net billions per month (given that there are millions of searches a day).

1. Imagine, the information collected

Information indexed is incredibly useful. So, Google can be said to know almost most of the visible Internet. Such information is useful to many people, granting a especially important feature of websites - traffic. With traffic comes ??? and finally profit! Though, collecting that much information takes money out of anyone’s pocket, and is more of an investment. There is a reason why Google has not 1 or 2, but over 50 datacenters (plus, a mountain full of bandwidth). Unless you had over $100,000 worth of funds like Google, getting a private search engine running is bound to be problematic.

Aside from traffic, some of these information is so valuable that people pay for it. Well, at least no one is doing it yet, but it’s known that Google is observing the information it collects - which is inclusive of web pages, and traffic information, but also visitor information as well.

2. In-site advertising

Webmasters will do anything to get traffic. Hoping to tap into the traffic of the giants themselves (traffic beyond anyone’s imagination), they will pay cash to get their site exposed as much as possible. Google AdWords is one of Google’s main sources of income. Advertising via AdWords is known to give plentiful traffic, but to Google it takes no cost to implement (since the ads appear on Google), giving it instant profit.

3. Advertising networks

Search engines bring in traffic, making it easier to establish advertising networks just like what Yahoo and Google has done (Live search has yet to do so). Google AdSense brings in money to the ordinary site owner. It brings in money for Google as well. After all, isn’t the advertising rates more than the payout rate? Implementing a super network like AdSense isn’t all that impossible for Google - in fact, no one actually minds participating in it (ah, the power of money).

4. Shares

Search engines turned business. People buy a stake on a search engine, and hope to earn from it (search engines are getting popular after all, making them a nice target). This is the main source of juice powering Yahoo and Google. Who wins? Google, Yahoo, and co.

5. Sparse competition

Fancy running a search engine? Well, good luck, because you will need it. Search engines are hard to maintain - hence there are not many search engines around. So, if you are at the top, you will remain there. Similarly for the opposite. Great for Google and Yahoo who were at the top of the pile since the Internet bubble. If you are the top, you have authoratian powers, and have the ability to command those who seek forth your services (because there are few alternatives), propaganda for money.