This past week the Yahoo!-Microsoft deal, or lack of a deal, has been hoarding the headlines. There have been pros and cons on why this deal should or shouldn’t go through, including many takes on what Google is doing to stop the deal. In reading some of these reasons why Google doesn’t want to see a completed deal, my one question is why not?
First of all, Microsoft is going to have to pay a hefty premium for getting Yahoo! in its portfolio. Next, just because Microsoft latches onto Yahoo! doesn’t mean it will be successful in turning Yahoo! around. Let’s face it, Yahoo! is no longer the search darling it once was. What about Microsoft? Will it be able to succeed with Yahoo! where Yahoo! itself has failed?
Microsoft has made its bundle of cash on its two major products: Windows and Office. These are the company’s cash cows. But if one looks at other ventures it has tried, the results have been less than favorable. MSN hasn’t been successful even though Microsoft has thrown at lot of cash at it. The Xbox 360 has been a major cash drainer since Microsoft has had to repair somewhere between 15 to 30% of the units, depending on which figures you wish to believe, costing Microsoft over 1 billion dollars in repairs and extended warranty. Microsoft also supported HD DVD over Blu-ray and we all know what happened to HD DVD. Even Microsoft’s dominant share of Web browsing has come under attack by Firefox, which is slowing eating away at market share.
I personally don’t believe that Google should be too concerned about whether the deal is completed. Google has a command of the search engine market and will continue its dominance, unless Microsoft can buy the Internet. 🙂
What do you think? Comments as always are welcome.