Peter Kafka

Recent Posts by Peter Kafka

Microsoft Says It’s Done Buying Search. Writing Big Checks for Search? Different Story.

ballmerBecause it’s her job, a Reuters reporter asked Steve Ballmer today if he’s planning to make any big, splashy M&A deals to boost his search business. And because it’s the truth, the Microsoft CEO said, no, he probably isn’t. Actual quote: “No, I wouldn’t expect it.”

What else would you expect Ballmer to say? Now that Microsoft (MSFT) has got its hands on Yahoo’s (YHOO) search business–without paying a “boatload” for it–there isn’t a whole lot left to buy.

Emphasis on the word “buy.” Microsoft may still be willing to write a big check to boost its search share, specifically to get its hands on queries controlled by Time Warner’s (TWX) AOL, which has about three percent of the domestic search market.

AOL currently outsources its queries to Google (GOOG) in a deal that is said to make quite a bit of money for both sides of the table because AOL’s core user base tends to click through at a much higher rate than the rest of the Web. But AOL’s Google contract is expiring, and both Mountain View and Redmond are thought to be in hot pursuit of a new one. AOL CEO Tim Armstrong, though, is taking his time about his decision.

Also in the potential mix for Microsoft: A deal with News Corp. (NWS), which owns this site. Google’s $900 million search deal with News Corp.’s MySpace and IGN sites expires next year, but unlike the AOL deal, it has been a disappointment for Google.

It’s hard to imagine Ballmer spending much to wrest that one away, but News Corp. digital boss Jon Miller is doing what he can to drum up interest: He’s been talking up the idea of bundling multiple News Corp. properties–like, say, Dow Jones–into a larger deal. But since many of those properties have their own particular agreements and peculiarities, that’s going to take some doing.


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Nobody was excited about paying top dollar for a movie about WikiLeaks. A film about the origins of Pets.com would have done better.

— Gitesh Pandya of BoxOfficeGuru.com comments on the dreadful opening weekend box office numbers for “The Fifth Estate.”