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Businesses Microsoft The Internet Yahoo!

Is Microsoft just Screwing with Yahoo's Mind? 209

The Narrative Fallacy writes "This week Cringely offers up a speculative piece asserting that Microsoft might not really care if its bid to buy Yahoo succeeds or not — Bill Gates just wants to disrupt Yahoo and poach the company's employees. 'Microsoft's offer for Yahoo has thrown that company and several others into a tizzy. Yahoo can't be getting much work done, that's for sure ... Redmond's real goal may be simply to poach people from Yahoo, and this deal could help them do just that.' Cringley says there is plenty of precedent for Microsoft's behavior — Microsoft's bids for Borland and for Intuit back in the 1990s sent both companies into a tailspin. 'A failed Microsoft bid, even one involving a termination fee, could lead to horrific results for the company. Remember that Yahoo is staggering here while Intuit was at the top of its market and its game.'"
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Is Microsoft just Screwing with Yahoo's Mind?

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  • by ScrewMaster ( 602015 ) on Saturday February 16, 2008 @02:28PM (#22446578)
    but is Microsoft capable of this? I'd say that's a given.
  • Treading Water (Score:4, Insightful)

    by wombatmobile ( 623057 ) on Saturday February 16, 2008 @02:33PM (#22446608)
    Yahoo is treading water. Microsoft is treading water. Neither company has innovated to grow new business for the last 5+ years. Meanwhile, Google has created growth. It has built and grown a large, growing advertising business. Now Microsoft has a paw on Yahoo, treading water next to it.
  • by zappepcs ( 820751 ) on Saturday February 16, 2008 @02:34PM (#22446614) Journal
    anything like fair?
    Sure, all MS has to do is either make their products better than anyone else's or scare everyone from investing in a competitor's business and products. Either one will result in Microsoft's favor.

    Business-wise, since Google isn't going to suddenly lose market-share it is necessary to gain market share, either by purchasing it, or causing your own product to gain market share.

    Some very large corporations in North America have been found guilty of this same type of practice. With all the MS bashing on /. this should come as no surprise AT ALL.

    Whether they actually buy Yahoo or not, MS wins in the business side.

    Sure, to the average joe it is hard to see the win, but if Yahoo loses revenues MS will begin to take them (what Google doesn't get anyway). In the business of becoming the largest in your field of endeavor having better products/services than your competition is only marginally more important (if at all) than your competitor being worse than you at the game of business. We all know that MS is very successful at business, not so much so at creating innovative products and services.
  • Re:Treading Water (Score:2, Insightful)

    by Anonymous Coward on Saturday February 16, 2008 @02:43PM (#22446694)
    "Microsoft is treading water."

    That is the trouble right there with discussing Microsoft. You really can't have a serious discussion of the company because there a million Microsoft fans who will flip out and point out that a company that Microsoft has/makes 'billions' and that is 'like an infinite amount of money'.

  • Re:Treading Water (Score:5, Insightful)

    by erroneus ( 253617 ) on Saturday February 16, 2008 @02:44PM (#22446702) Homepage
    That's a fact and I'd add more to this by saying that Microsoft is "leadership" and "vision" poor. They are not likely to be short on talented or skilled people. The reality is the decisions and priorities that Microsoft is following are what's leading to its hardships at the moment. They had defined "computing" as we had known it for around 10 straight years but that position has slipped quite a bit and pretty much everyone is doubting Microsoft's vision and wisdom in the industry -- even the end users -- and it would seem Microsoft has yet to realize that they no longer truly wield the power over people's minds that they once had. (Or perhaps they are realizing it and are attempting to compensate in other [failing] ways?)

    Once upon a time, Microsoft made cool stuff and people bought it... a lot of it. Then, for some reason, marketers took control of the company instead of the creative people and now people are wondering why Microsoft is failing.

    It's LEADERSHIP and lack of vision that is dooming this once incredibly influential company. Attempting to poach employees from Yahoo, an equally if not more stagnant company, isn't going to anything but rearrange the deck chairs on their Titanic.
  • by Anonymous Coward on Saturday February 16, 2008 @02:48PM (#22446740)
    ...where someone writes about some random theory in an attempt to milk the MSFT+YHOO story without having any new facts to report.
  • by mritunjai ( 518932 ) on Saturday February 16, 2008 @02:50PM (#22446756) Homepage
    Please keep in mind that stock price inflation is due to "premium" put up MS and speculators have driven up the price which *would* fall down if the deal doesn't go through.

    I'd expect a lot of speculators to actually short the stock.

    All in all, for a serious business, it's *not* a good thing to be in this situation. Even in best case it'd rock the boat and cause heart-burns and unrest whether the deal goes through or not.
  • by gadget junkie ( 618542 ) <gbponz@libero.it> on Saturday February 16, 2008 @03:03PM (#22446844) Journal
    ... that Microsoft's business acumen in providing a better product over the years [youtube.com] has overflowed into their Corporate Finance department.....

    Jokes apart, there is a possible explanation which implies no wickedness on the part of MS: MS investments in his search engine + ad seller has been less effective than Yahoo's. MS would never be allowed to bid for Google, so it must settle for second best, which is not a bad place to be if you are much lower in the totem pole.

    Given the cash pile burning a hole in MS pocket the cash pile burning a hole in MS pocket [yahoo.com], the pressure to put the money to work somewhere, or return it to shareholders, is enormous, and they cannot or would not invest it in making a better product overall.
  • Re:Treading Water (Score:5, Insightful)

    by webmaster404 ( 1148909 ) on Saturday February 16, 2008 @03:04PM (#22446856)

    Once upon a time, Microsoft made cool stuff and people bought it... a lot of it. Then, for some reason, marketers took control of the company instead of the creative people and now people are wondering why Microsoft is failing.


    No, once MS, Bought cool stuff from other companies, rebranded it and made deals with OEMs so people would use it. Just about EVERY thing MS has done has been bought by other companies. If it wasn't for getting lucky with DOS (which they bought from someone else) and IBM they would not be existing right now. All MS survived on is luck and buying companies that do innovate. Now that they managed to monopolize all the OS industry, they have just left the community projects like Linux that can't be bought and Apple which would be highly unwilling to be bought. Everything MS has done was by money, even though they have good coders, all MS has done is buy and buy and now they have scared all the competition from even trying, they have nothing left to buy and are now stagnant. Yahoo innovated slightly but I still think it represents the early '90s on the Web whereas Google represents the present age.
  • by Etherwalk ( 681268 ) on Saturday February 16, 2008 @03:05PM (#22446868)
    I've ever heard. And I've played catch with rock hammers.

    MS did it because they wanted to consolidate a larger advertising and search engine position, and a major internet portal. It was probably still a bad decision, but who can really say what the results would have been ten years down the line?

    Look at what MS Stock did. It had broken out of a major rut--a rut not justified by its earnings--for the first time in years following an earnings report last year. Now it's down 24% off its high. Twenty-Four percent. Balmer has lost $3.6 Billion, Gates has lost twice that, and even employees who've only lost twenty or fifty or seventy thousand aren't happy about it--because that is a big chunk of their savings. Now that price change isn't all yahoo, by any stretch of the imagination. But a big chunk of is it from the Yahoo offer.

    You don't take that hit for an offer you aren't interested in following through on.
  • by blowdart ( 31458 ) on Saturday February 16, 2008 @03:17PM (#22446932) Homepage
    See it's weird; I thought that the google proposed partnership was a spoiler and a non-serious offer just made to burn up more of Microsoft's warchest by giving Yahoo a plausible reason to drive the price up. And the goggle thing dissolved away very quickly, whereas the Microsoft offer is still on the table.
  • Nonsense (Score:5, Insightful)

    by sjbe ( 173966 ) on Saturday February 16, 2008 @03:31PM (#22447016)
    Nobody makes a $40B+ offer just to screw with another company. That's WAY too much money. While business disruption might be a desirable side effect, especially if the merger doesn't go through, it isn't why MS made the offer. When MS tried to buy Intuit, it was because they wanted to dominate personal finance software, not because they wanted to screw with Intuit. If memory serves they were blocked from the merger by the government due to the effective monopoly the merger would cause.

    If I was a shareholder (I'm not) and it ever came out that MS was doing that with their cash hoard instead of finding market beating investment opportunities, I'd have my lawyer on the phone faster than you could say "class action lawsuit".
  • Re:Treading Water (Score:4, Insightful)

    by abigor ( 540274 ) on Saturday February 16, 2008 @03:50PM (#22447144)
    Actually, it's flat because MS is transitioning from being a pure growth stock to a blue chip stock, complete with dividend payouts, which are still too small. Successful blue chips generate huge profits and sustain predictable growth year over year, but their stock prices aren't particularly volatile. MS is not paying large enough dividends, causing the stock to flatline (this may have changed recently, as I'm not up to date with their latest actions).

    MS is no longer like a Google-style volatile growth stock. It's more like investing in Johnson and Johnson or something. They need to increase their dividend payouts, if they haven't already.

  • Re:Treading Water (Score:5, Insightful)

    by rucs_hack ( 784150 ) on Saturday February 16, 2008 @04:01PM (#22447244)
    Purchasing smaller companies that produce products you want to incorporate into your business is standard industry practice...
  • by osu-neko ( 2604 ) on Saturday February 16, 2008 @04:07PM (#22447302)

    Ok, perhaps it is true, but if Microsoft were investing so much time and energy being evil in every move they make, don't you think they wouldn't be the #1 company in the field? (profits wise). I'd have thought they'd have slipped a while back.

    Err, no. All of the the above would make sense if it were true that being evil is bad for business. Alas, the reason companies usually behave in an evil manner is because it helps them financially. You can't point to financial success as evidence they're not evil. It doesn't necessarily prove they are, either, despite popular perception. Classically, though, the temptation to do evil is almost always because you do better materially when you do, so your contention above flies in the face of classical reasoning on the subject.

    IBM used to be right evil buggers, and it cost them their lead in a big way

    IBM's evil is was sustained it as long as it did. It was IBM's arrogance that brought them down.

  • Re:Treading Water (Score:3, Insightful)

    by Anonymous Coward on Saturday February 16, 2008 @04:27PM (#22447464)
    Google represents the current age? What exactly has google done that is innovative aside from adsense? Search was already done, it was just an incremental improvement. And then they did what you say Microsoft did, they purchased. They bought maps, blogging sites, on-line office suites. Googles products are driven by acquisition and not innovation.
  • Re:Treading Water (Score:2, Insightful)

    by bigpicture ( 939772 ) on Saturday February 16, 2008 @04:28PM (#22447470)
    I believe you have framed the actual situation very accurately here. The MS leadership didn't actually have a lot of vision, they just bought up cool stuff companies who seemed to be succeeding in the marketplace.
  • Comment removed (Score:5, Insightful)

    by account_deleted ( 4530225 ) on Saturday February 16, 2008 @04:42PM (#22447570)
    Comment removed based on user account deletion
  • Re:Treading Water (Score:2, Insightful)

    by tiffany98121 ( 1094419 ) on Saturday February 16, 2008 @05:34PM (#22447972)
    $265 Billion is "pretty close" to $165 Billion? What?
  • by LibertineR ( 591918 ) on Saturday February 16, 2008 @06:13PM (#22448244)
    What product makes Microsoft their greatest profit? Answer = MS Office.

    Which department decided to bundle Microsoft's desktop apps into what is known as MS Office? Answer = Microsoft's Marketing Dept.

    You must be very young to believe Microsoft simply BOUGHT all of their products, or that everything successful is simply the result of their money.(Did I mention MS Office?)

    Love them or hate them, but you would be foolish to think Microsoft never built anything on their own towards their success. They didn't buy Excel, they didn't buy Exchange Server, which spawned Active Directory, so give them their due.

    Nobody told the folks at Lotus or Netscape that they got beat by money, rather than products that kicked theirs in the teeth. Who did they buy Visual Studio or the .NET Framework from? Something tells me, Microsoft will be just fine for the long term.

  • by westlake ( 615356 ) on Saturday February 16, 2008 @07:07PM (#22448566)
    If it wasn't for getting lucky with DOS (which they bought from someone else) and IBM they would not be existing right now.

    It amazes me that the geek still fantasies about MS-DOS.

    Microsoft was incorporated in 1975 and by 1980 was dominant in languages for the microcomputer. Microsoft was moving up and moving fast.

    There would be an MBASIC for the IBM PC and much, much more to come.

    Gates promised to deliver a cheap, serviceable, OS in time for the projected launch of the IBM PC, an OS that would sell for about 1/6 the price of CP/M 86.

    That was all IBM needed to know, that was all IBM wanted to know.

    But it was Bill Gates who had the imagination to see the enormous potential for growth and profit in the MS-DOS PC that was almost - but not in its beginning - an IBM PC-clone.

  • by FlyingGuy ( 989135 ) <.flyingguy. .at. .gmail.com.> on Saturday February 16, 2008 @08:50PM (#22449214)

    Anders is the Darth Vader of the software industry.

    Ever wonder why so much of .Net looks just like stuff that Borland came out with, except that it sucks? Seduced by the dark side he was.

    Anders is brilliant, he could have created his own software company and did something like .Net that actually was light weight, fast and X-Platform, but instead, .net is .Garbage because it is done the "Microsoft Way".

  • by Fulcrum of Evil ( 560260 ) on Saturday February 16, 2008 @10:49PM (#22449826)
    No, a 44B offer is absolutely a poker bet. Just because the numbers are big doesn't mean that the rules change. Poker is about psychology, and that doesn't vary with the stakes.
  • You must be very young to believe Microsoft simply BOUGHT all of their products, or that everything successful is simply the result of their money.(Did I mention MS Office?)

    This could be turned around on you, you must be very young to believe MS Office was innovative or the first office suite. All MS did was bundle different apps together. And even then though my memory is rusty I believe WordPerfect bundled an office suite before MS did... Yeap, whereas MS Office [wikipedia.org] was first created in 1989, for the Mac, WordPerfect Library/Office [wikipedia.org] was created in 1986.

    Love them or hate them, but you would be foolish to think Microsoft never built anything on their own towards their success. They didn't buy Excel, they didn't buy Exchange Server, which spawned Active Directory, so give them their due.

    MS did nothing innovative, as far as software is concerned or hardware either, though.

    Falcon

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