Yahoo may consider Google alliance, source says

[OhioChick]

Source: Reuters/India

Mon Feb 4, 2008 2:44pm IST

SAN FRANCISCO/NEW YORK (Reuters) - Yahoo Inc would consider a business alliance with Google Inc as one way to rebuff a $44.6 billion takeover proposal by Microsoft, a source familiar with Yahoo's strategy said on Sunday.

Yahoo management is considering revisiting talks it held with Google several months ago on an alliance as an alternative to Microsoft's bid, that source said. At $31 a share, Yahoo believes the bid undervalues the company, two sources said.

A second source close to Yahoo said it had received a procession of preliminary contacts by media, technology, telephone and financial companies. But the source said they were unaware whether any alternative bid was in the offing.

In a memo to Yahoo employees on Friday, which was obtained by Reuters on Sunday, Yahoo leaders wrote: "We want to emphasize that absolutely no decisions have been made -- and, despite what some people have tried to suggest, there's certainly no integration process underway."



Read more: http://in.reuters.com/article/businessNews/idINIndia-31751420080204

[u2spirit]

1. I don't like the sound of this

Sounds like a way to avoid competition.

[ixion]

2. huh? It sounds to me like a way to maintain competition

Certainly, being bought out by M$ is not going to increase the competition, given M$'$ current stranglehold on the market.

[Lance_Boyle]

7. Backwards. MS has no stranglehold on the web ad market

Google does. Next to google and yahoo, MS is not even a competitor. Which is why MS wants to acquire yahoo to compete. Google acquiring yahoo would be the anticompetitive move in this market.

[ixion]

9. they have a near monopoly in the browser market, and have shown contempt for industry standards

their msn and msdn sites are lame. Why the hell would you want to give them a foothold in the search engine vertical?

[Lance_Boyle]

10. browser market != web ad market

Standards compliance and browser market share criticisms are the reddest of herrings in this discussion. Obviously, MS isn't very competitive with its msn sites (msdn is not a mainstream portal, and web ads there would target a niche tech market), which is why they want to obtain yahoo's sites - those are competitive.

Why the hell would anyone want to deny another player entry into the web ad market? Dominance by google is certainly a worse situation than google/MS competition, right?

[ixion]

11. It's a close call

I agree with you that google has become a behemoth. On the other hand, M$ has ruined everything they've ever delved into, so that's not a terribly exciting option, either.

Sorry, I'm just really no fan at all of M$.

[Lance_Boyle]

12. I'm equally leery of both

Which is why I'd like to see them expend their efforts against one another, rather than against the rest of us. ;-)

[ixion]

13. yeah, I'd like to see someone new to the game introduce the next killer app

rather than having two over-sized corporations continue to hog up the bandwidth. I don't disagree with you about Apple or Google. Both were once cool companies that are now too big for their britches. But M$ has proven time and time again that it's sole purpose is to crush competition and innovation, not encourage it. At least google has provided some interesting API's and the like, whereas M$ offers nothing for under $1,000 bucks.

[madrchsod]

3. good idea

anything from keeping microshit from taking over the the only source of free research.

[OhioChick]

4. Google plays antitrust card on Microsoft's Yahoo bid

Google plays antitrust card on Microsoft's Yahoo bid
Says deal could let Microsoft exert 'illegal influence over the Internet'

February 4, 2008 (Computerworld) Google Inc.'s chief legal officer today fired the first shot of what will likely be an antitrust salvo at Microsoft Corp. over its unsolicited $44.6 billion bid for Yahoo Inc. Within two hours, Microsoft countered.

Saying that the offer "raises troubling questions" about Microsoft's moves and arguing that a deal might threaten the "underlying principles of the Internet: openness and innovation," David Drummond, Google's chief legal officer, explicitly laid the antitrust card on the table.

"Could Microsoft now attempt to exert the same sort of inappropriate and illegal influence over the Internet that it did with the PC?" Drummond asked in a post to Google's corporate blog on Sunday. "While the Internet rewards competitive innovation, Microsoft has frequently sought to establish proprietary monopolies -- and then leverage its dominance into new, adjacent markets."

In a statement released about 90 minutes after Drummond's post went live, Microsoft's chief counsel, Brad Smith, shot back, saying that a Microsoft-Yahoo merger would "create a more competitive marketplace," not stymie competition.

http://www.computerworld.com/action/article.do?command=viewArticleBasic&articleId=9060798&intsrc=hm_list

[Javaman]

5. Queue the death star music...

and what of anti-trust laws? pffft! that is sooooo 20th century.

[Phred42]

6. Consolidation llike this Dangerous.

Yahoo-MS consolidation would also be dangerous for America.

Remember when CONGRESS actually enforced the Anti-Trust laws?

[hertopos]

8. Actually I hate Google as a company

Google is one of the most elitist company in recent memory.
Their stock price is now over $500 per share.

No, normal young computer geek can invest in its share. ( Typically, you have to by 100 share, which is over 50k.)

The more I learned about Google, the less I like the company.
Google originally declined on Yahoo.
Now, it's panicing and has a second thought.

Oh, well, it is not important for my everyday life...

Though I don't like Microsoft monopoly, I don't have any illusion about 'Apple or Google'. They sounds cool but that doesn not mean they are better.

Hertopos

[Xithras]

15. Elitist?

Google has little control over their share price, they went public at $85 a share and the rest of the gain has been solely market driven.

Google is actually one of the best tech companies to work for if you can get hired. Gourmet catering every day, no middle management to deal with, flexible work hours, tons of vacation time, pay rates nearly double the industry average...there is little to complain about.

People don't like Google because they don't like the "big guy", but Google is the big guy because it still has the best DB and search algorithms. Their ad program dominates the industry because they came up with a model that profits EVERYONE involved, instead of hoarding the profits for themselves. If you have a site with any kind of traffic, putting Google ads on your site is a guranteed way to make money. That's why DU has them. Previous ad systems hoarded money or made it nearly impossible for site operators to see any real return for sacrificing screen space, which is why they were abandoned so widely when Google released theirs. DoubleClick and their competitors lost market share because they were greedy, not because Google played like a monopoly. Google came to dominate the market because they wanted to work with site owners, not dictate terms to them.

Oh, and you shouldn't buy tech stocks just because you're a "young computer geek". I'm an old computer geek (been programming as a hobby since 1985, and professionally since 1993) and I don't own a single tech stock. As big as the GOOG and AAPL are, there are plenty of stocks that will make you just as much money with more reasonable entry points (I wouldn't have minded owning a few thousand YHOO last Friday though). Most tech stocks have been on a long decline since the second half of last year, and there's no sign of a turnaround. If you really want to invest, look into financials. Many of the bank stock values have been hammered to almost nothing because of the sub-prime crisis. These companies aren't going to fold, but they're having a serious short term crisis right now that's reflected in their stock price. If you're looking to make a long investment, it's a good area to look at. Heck, a year ago Washington Mutual was trading for $45 a share, a level it's maintained for most of the decade. The stock price crashed to $12 as recently as a few weeks back, so I bought a couple thousand shares. The bank is in no danger of locking its doors, and there's nothing to indicate that it won't recover in a few years (it's already back up over $19). When that happens, its stock should return to its normal level and I'll make lots of money. This is just ONE example of an oversold market that is full of opportunities for those looking to make a long term investment. Instead of complaining tht GOOG and AAPL are too expensive, look for some of the deals created by the current down-market and buy before they evaporate.

[Seabiscuit]

16. Huh? I don't know where you picked up such misconceptions...

1. A while ago I bought 24 shares of Google stock at $350/share. I sold when the market price reached $515/share. Since then it jumped up into the $700+ range, and recently has sunk below $500/share.

2. No one has to buy more than 1 share of Google at a time. Maybe some broker has told you he doesn't want to waste his time with your investments unless you've got at least $50K to invest, but I can't even imagine the crookedest broker telling someone they have to buy 100 shares to buy Google stock at all. I do all my own investing through a brokerless Schwab account. You don't need $50K to open one.

3. "No normal young computer geek can invest in its share"? Well, assuming "no normal young computer geek" has $50K to invest, maybe they're not ready to get into investment yet. And if "no normal young computer geek" can afford to buy a share of Google for $500, they clearly are not yet ready to invest in anything.

4. Apple, Google, and Microsoft have all been good investments over the years. None have monopolies on anything.

5. Apple and Google prices are currently artificially depressed as a result of the overall market recession. It's a good time to buy those stocks. If you buy now and sell say, by the end of the year, I would say you're probably guaranteed to make a sizable profit.

Have you ever done any investing at all?

[nxylas]

14. Microsoft vs. Google