"Boatloads of Money" Brings Boatloads of Trouble to Yahoo's Bartz: The D7 Video (Plus How the Deal Almost Sank)
One of the reasons Wall Street investors have gone sour on Yahoo’s stock since its online advertising and search deal with Microsoft was announced is due a much-repeated comment that CEO Carol Bartz made at the seventh D: All Things Digital conference in late May.
In an onstage interview with me, I asked Bartz about how talks with Microsoft (MSFT)–about which I had reported a lot–were going and what it would take to do a deal.
She answered quite emphatically that “if there’s boatloads of money, and there’s the right technology and there’s the right information we’d have, sure.” Bartz repeated “boatload of money” soon after.
And, since she said that’s what she wanted, Wall Street had expected such a windfall immediately in the deal.
But, with no upfront payment forthcoming–despite the fact that Bartz said she opted for money over a longer timeframe via better search monetization from Microsoft–Yahoo (YHOO) has seen its shares get pummeled.
The stock was down 12 percent when the deal was signed Tuesday and almost four percent today, giving up a lot of the gains that have been made since Bartz came on board in January.
Ironically, in an interview with me right after the deal was struck, both Bartz and Microsoft CEO Steve Ballmer told me it was at a meeting they had at D7 that they decided to call an end to the talks that had been going on since March.
The reason was that a plan to also share display advertising was on the table and it had added a level of complexity that was too hard to bridge.
“We agreed to walk away, the game was over,” said Bartz. “It was our ‘hasta luego.’”
Well, not for long, as the execs under them both regrouped and came up with the simpler search plan–a deal that Yahoo investors are still unsatisfied with.
Now, it will be up the Bartz to convince them that their ship will–eventually–come in.
Until then, here’s the “boatloads of money” video clip: