MicroHoo: A Deal Must Be Done
While Microsoft’s (MSFT) CEO Steve Ballmer and Yahoo’s (YHOO) CEO Jerry Yang hemmed and hawed about what had happened in their disastrous takeover battle that ended not with a bang, but a whimper, everyone else who appeared onstage at the sixth D: All Things Digital conference last week was a bit more definitive about what should occur now:
Get it done.
From Thomson Reuters’ (TRI) Tom Glocer to IAC’s (IACI) Barry Diller to TiVo’s (TIVO) Tom Rogers to Rupert Murdoch of News Corp. (NWS) (who simply said: “I’d get on with it.”), it seemed obvious to one and all that the only way either had a prayer of catching up with online search leader Google (GOOG) was to join forces.
It seems, according to many sources, that the pair are now in serious talks again, which–if they are smart–will come to some resolution, yes or no, within the next week. (You’ll get first wind of what’s what, as soon as much-frustrated bankers begin their leaking to major news outlets.)
Whatever the case, I dearly hope these discussions are not bogged down as they have been before.
Not in the bits and pieces niggling of some complex partial deal to buy search and spin of this and that here and there in a configuration sure to confuse everyone.
And not continuing with the endless roundelay of price negotiations that seems to have needlessly taken focus off the ball–which is to create a competitive alternative to the incessant brainiacs of Google (and if you want any more proof of that, see this New York Times piece today about the search giant’s data-crunching abilities).
It seems $33 to $34 a share will still wrap the whole thing up and, if Microsoft was serious about its intentions to buy Yahoo when it first made its foray in February, that seems doable.
Because, if Ballmer is serious about his contention, which he made fervently onstage at D6, that the software giant keeps “coming and coming and coming,” it simply cannot make that attack from a piddling 9% market share in the online search business.
One of the most interesting takeaways I had from last week’s interview Walt Mossberg and I did with him and Chairman Bill Gates (who seemed about as underwhelmed by a Yahoo deal as possible without slumping over asleep) was the early focus at the company on fiscal conservatism.
Baked into its DNA, as it turns out, is a fear of bankruptcy even.
While that was funny to hear about–complete with worried financial calculations on sheets of yellow paper stuffed in couches early on–it seems to continue to this day, despite Microsoft’s huge treasure chest of cash.
But Ballmer should slough off that tendency, as Microsoft can afford all of Yahoo and it should if it wants to make the boldest case possible that it will compete with Google.
As for Yahoo, both Yang and President Sue Decker are to be lauded for showing up to answer Walt’s questions (and one by me via remote video about leadership, which neither actually did answer) about the company and its future.
Their sincerity and love of Yahoo and its products and people was clear and even touching, making it clear that companies are a true reflection of its leaders.
But, while making good points about the he-said-she-said nature of the past Microsoft talks, the pair still could not adequately and passionately explain what Yahoo is exactly, which everyone I spoke to in the halls was surprised and even disappointed by.
Moreover, their weariness for the next phase of tumult that will come if Yahoo remains independent was apparent in both their body language and low energy levels, especially when compared to others onstage like Murdoch, Amazon’s Jeff Bezos and, of course, the frenetic Ballmer.
Yang and Decker need big-time help and they need it now, help that cannot come from their own dwindling energies and that of their much-beleaguered troops.
Still, they also deserve credit for this very funny spoof video of advice they have been getting.
I especially like the turn by famed investor Warren Buffett best, with his “buy low, sell high” tip.
But I would fiddle with that to change it a little bit for Yahoo today: Just sell high enough.
Here’s the Yahoo spoof video: