Was the Yahoo-Google Deal a Ploy To Weaken Yahoo? 82
JagsLive writes with a link to a BetaNews story about a US Senator who is questioning whether the deal between Yahoo and Google was brokered with less than honorable intentions on Google's part. The advertising deal came under scrutiny from the Department of Justice recently for potential antitrust violations. The deal has now been delayed in order to allow investigators more time for evaluation. Meanwhile, rumors are circulating that Yahoo will cut as much as 20% of its workforce after an internal memo from CEO Jerry Yang called for "discipline" and said the company was "getting fit" for the long term. For their part, Google has launched a site endorsing the deal and attempting to smooth the way for its approval by providing facts and positive reactions from experts.
First! (Score:3, Insightful)
Feigned buyout intentions. (Score:5, Insightful)
Feigned buyout intentions are used occasionally by unscrupulous business folks to damage competition. Here's a scenario used often (short version):
Potential buyer walk up to a company and says they would like to purchase it. The seller, who is interested says sure. After long negotiations, the buyer starts making demands for the deal to go through, such as: firing key employees because they "don't fit in the new company", canning key suppliers or not paying them on time to make the cash situation better, announcing to customers that there's a transaction going on, and other things to fuck up the company so that they will buy it - only under those conditions. Then, the buyer walks away. The seller is now pretty much fucked. It doesn't sound like anyone would fall for this, but after slow, very slow, negotiations for a while, and a strong desire by the seller to sell, it happens ever so slowly and after a while, the seller is afraid to bail because he's so far down the road, he keeps going along with the hopes of finishing.
BTW, not everyone can do this. You have to actually be someone who has the resources to do this. You or I walking up to a business, no matter how small, without any track record or business history will be ignored. It's usually done by competitors who want to knock out the competition. So, don't think you can wipe out the guy who screwed you on your WoW special edition throne.
Re:Feigned buyout intentions. (Score:5, Insightful)
weaken it???? (Score:3, Insightful)
Re:Feigned buyout intentions. (Score:3, Insightful)
This deal is more likely to strengthen Yahoo (Score:5, Insightful)
That really doesn't make much sense. Consider this:
- Yahoo tested Google's AdSense instead of their own ad system a while ago.
- Then they switched to AdSense.
Obviously, this means that the cut they got from AdSense was higher than what they got from their own ad system, because Google's ads are better/better targeted/people pay more for AdSense/whatever other reason.
Equally obviously, the people who run Yahoo's ad system aren't needed any more. So they get laid off. New positions will open at Google though.
In other words, Yahoo is making *more* money now than before. That's not what I'd typically call 'weakening' a company.
The drawbacks for Yahoo are the following:
- Google - its main competitor - is ALSO making more money now.
- They're dependent on their main competitor; given Google's history of mostly not being assholes, that's not as bad as being dependent on other companies though. Still, I'd call this the main drawback of the deal.
- Google now knows everything about Yahoo's audience. Since they have the largest search engine and the Google toolbar though, they probably already knew this before.
To wrap it up, I do not believe that this is weakening Yahoo.
Comment removed (Score:3, Insightful)
Re:Feigned buyout intentions. (Score:2, Insightful)
Re:First! (Score:3, Insightful)
"how can a non-exclusive deal weaken yahoo"
My further entrenching a monopoly they compete with and making it far harder for new entrants of even existing market players to enter their space?
Oh, and why do you find it so hard to believe that Google would deliberately weaken its competitor? What if it was Microsoft brokering a similar deal with, say, Red Hat?
Seriously, enough with the "we love Google" rubbish. They're a profit seeking company, just like any other, and they don't play fair, they just have a better handle on how to direct your attention to the bones they throw at the FOSS community while they go about their business.
Re:I work at Yahoo (Score:5, Insightful)
I don't know where you've been, but Yahoo! has been primarily a content provider, a portal, for years now. You sound like you are still living in 1999.
Re:So? Is anyone really surprised? (Score:4, Insightful)
Instituting keyword filters at the request of the Chinese government. Google's do no evil policy only applies to the U.S.
This argument is, and always will be, fucking retarded.
These are your only two options when dealing with China:
1) Play by their rules, begin to do business there, then once you're entrenched there begin to try to make changes.
2) Don't play by their rules, get blocked completely. A Chinese-owned search engine takes over and is completely in the pocket of the government and always will be.
That's it. Those are your only choices. Which is the better one for the people? If you think anything but the first, you're a fucking idiot.
Yahoo more like Wal-Mart in the deal. (Score:4, Insightful)
Google to Yahoo is like Vlasic to Wal-Mart in your example. Google is the supplier, and Yahoo the distributor. Establishing a distribution channel is the hard part, so Wal-Mart had an upper hand to threaten the termination of the non-exclusive deal because that would significantly affect Vlasic the supplier by undercutting its product distribution.
Yahoo in the Google ads deal already has its own distribution channel and even its own supply of ads. Yahoo is more like Wal-Mart, who carries its own Sam's Club breakfast cereal in addition to well-known brands such as Kellogg's and Quaker.
Re:I work at Yahoo (Score:3, Insightful)
Think about it as an injured Olympics athlete on life support for the moment. It's up to you whether you want to take physical therapy and resume an athletic career, or stay on the wheel chair forever.
Re:Feigned buyout intentions. (Score:2, Insightful)
The only one who thought the Microsoft offer was lowball is the delusional Yahoo execs. Microsoft offered a 40% premium on the market price. That's generous by any measure.