tag:www.readwriteweb.com,2011:/1/tag:www.readwriteweb.com,2008://1.6537- 2011-04-29T11:28:46Z Comments for What's Next for Microsoft and Yahoo! Movable Type 4.35-en tag:www.readwriteweb.com,2008://1.6537 2008-06-12T20:53:31Z 2008-06-12T22:42:47Z What's Next for Microsoft and Yahoo! Update: Yahoo! and Google have indeed announced a partnership in the form of a non-exclusive deal allowing Yahoo! to run Google advertising alongside search results. The press release is here. The clumsy $44 billion mating dance that began in February between Microsoft and Yahoo! officially came to an end today. Yahoo! and Microsoft each issued... Josh Catone http://www.readwriteweb.com/

Update: Yahoo! and Google have indeed announced a partnership in the form of a non-exclusive deal allowing Yahoo! to run Google advertising alongside search results. The press release is here.

The clumsy $44 billion mating dance that began in February between Microsoft and Yahoo! officially came to an end today. Yahoo! and Microsoft each issued statements saying that talks had been concluded, though Microsoft left the door open for non-outright-acquisition partnerships. Meanwhile, multiple sources are reporting that Yahoo! and Google are set to announce some sort of search deal, perhaps as early as today. So what's next for both companies?

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Yahoo!'s stock sank 10% on the news that the Microsoft deal was definitely off the table. And the company reportedly lost three key employees today as well. Usama Fayyad, the Executive Vice President of Research, Technology Evangelist and key open source advocate Jeremy Zawodny, and EVP of the Network Division Jeff Weiner are all supposedly planning leave the company. Definitely not a good day for Yahoo!

Plan B prospects don't look great for the Sunnyvale, CA-based company. The brightest alternative is the prospect of a search outsourcing deal with Google. That deal, if it happens, could take any number of forms -- Google takes control of all Yahoo! search marketing, Google takes control of a portion of search marketing, Yahoo! open sources their search marketing allowing both Google and Microsoft to sell on their inventory, etc.

Given that Microsoft left the door open to an "alternative transaction," which we have speculated may be the acquisition of Yahoo!'s search business, it might be unlikely that a Google-Yahoo! deal would shut Microsoft out completely.

The dissolution of the Yahoo!-Microsoft acquisition talks also means more pressure is put on Yahoo!'s in house efforts to bolster their search business -- which slipped again last month -- such as SearchMonkey (our coverage) and Panama (our coverage). Last summer we wrote that the path to fixing Yahoo! started with a developer platform -- that's the direction they are headed with SearchMonkey. Without Microsoft, they have a lot riding on its success.

Microsoft

Microsoft has more options than Yahoo! Without Yahoo!, making a dent in Google's dominant search market share seems even more implausible, but the company can do other things to shake up their web business. We suggested a detail plan B in February that would have Microsoft "split up the search advertising atom" and basically open source their web marketing business. By breaking advertising up into inventory, placement, and parameters and allowing anyone to sell over this open model, we predicted that Microsoft could potentially make a huge impact on Google's web advertising dominance.

"Let Google be the search giant. Instead, focus on shaking up the advertising industry by pushing it toward a democratized structure, make it work for everyone, and weaken Google's business model," we wrote.

We've also suggested that Microsoft could put search on Facebook. "There are two ways people find information on the Internet: via search (which Google is great at), and via their friends (which Facebook is great at). The former we also know how to monetize. If Facebook can get good at search, it could stand to make a lot of money for whoever it partners with for that -- the logical choice being Microsoft," we wrote last month. Microsoft might even consider buying Facebook as an alternative to Yahoo!

Of course, not buying Yahoo! (or Facebook) would free up a ton of cash for Microsoft to do what it said it would last October: start investing heavily in small, web 2.0 start ups. Microsoft CEO Steve Ballmer said that the company would buy 20 companies per year ranging from $50 million to $1 billion for the next five years (likely they can acquire a lot of great technology for even less than that).

Our advice: invest heavily in mobile. If you can't beat Apple in the handset or software market, at least make a move to become the dominant content and advertising provider on the mobile web and beat Google to it.

What do you think are Microsoft and Yahoo!'s next moves? Let us know in the comments below.

]]> tag:www.readwriteweb.com,2008://1.6537-comment:308629 Comment from Sesli Sohbet on 2011-03-11 Sesli Sohbet http://www.seslisohbetbk.com/ How am I supposed to compete?

]]> 2011-03-11T22:06:11Z tag:www.readwriteweb.com,2008://1.6537-comment:57853 Comment from skeleton on 2008-06-13 skeleton i think the problem was that the mating dance turned into an alpha-male (Ballmer) beta-male (Jerry Yang) confrontation, and while Ballmer was trying to but heads, Yang was probably dancing around the room trying to make himself look bigger than he was bragging about all of Yahoo's services/offspring (Yahoo Buzz, Yahoo Personals and other such nonsense), and threatening him with poison tree frog/stockholder rights clauses.

you can't really blame them either. i think its an unsolvable problem figuring out how much a web portal like Yahoo is actually worth.

These guys (microsoft employees actually) do a pretty good job of trying, but ultimately fail:
http://www.seattleuntimely.com

]]> 2008-06-14T06:50:50Z tag:www.readwriteweb.com,2008://1.6537-comment:57704 Comment from Alex Schleber on 2008-06-12 Alex Schleber http://businessmindhacks.com BTW, the "Goo-hoo" search-ad-serve outsourcing deal just went through:

http://www.techcrunch.com/2008/06/12/yahoo-runs-into-googles-arms

Also, read some more analysis I posted today here:

http://businessmindhacks.com/post/microhoo-the-post-mortem-post-part-2

Cheers!

]]> 2008-06-13T00:56:28Z tag:www.readwriteweb.com,2008://1.6537-comment:57703 Comment from Alex Schleber on 2008-06-12 Alex Schleber http://businessmindhacks.com I agree in principle that a "democratized" search ads or anything else like that could work for MSFT in terms of competing with Google by jumping to a new curve.

Unfortunately I just don't see that in MSFT's DNA as a company. If anything they have the opposite impulses.

As for buying Facebook, the problem would be for MSFT to avoid infecting it with its penchant for heavy-handedness, corporate speak, not-cool branding, etc.

(Remember that users on a social network are not nearly as locked in as MSFT is used to from their Windows OS and Office properties where they in reality deal mostly B2B, and can do a lot of arm-twisting due to their near monopoly. That doesn't go over so well on the internet as they've already found out over the last 12 years.)

But it would be a better move than the Micro-hoo deal ever was. Provided that they can get over themselves.

As for buying other, smaller companies, I've been saying that for a while now: Twitter and Wordpress should be near the top of the list. Same caveats as with Facebook apply. Can MSFT become nimble and finally get the internet instead of resisting it, that is the question.

]]> 2008-06-13T00:52:40Z tag:www.readwriteweb.com,2008://1.6537-comment:57701 Comment from Chris on 2008-06-12 Chris Dear Mr. Yang: Its not the advertising STUPID

Yes advertising is important I'm not saying that.

But for Yahoo's case, GOOGLE has a better search engine. More and more poeple know this and more are starting to use Google's search engine. This is the sole reason why Google dominates and has market share in advertising.

Tieing up Google's ad's with Yahoo's does absolutley NOTHING to imporve their situation. I'm not going to deny that this proposed deal won't increase revenue for the SHORT term. Key word short term. But as more and more users shift over to Google's SUPERIOR product the amount of advertisiments being displayed will be less thus making a long term deteriation of their advertising revenue.

The deal with Microsoft is blatently the best option Yahoo had. Mr. Yang has proven to be an utter retard that is not acting in the shareholders LONG TERM interest. A Microsoft deal would of proposed a better alternative since Microsoft proposed combining the search operations. Not only to increase the amount of search queries owned by Microsoft-Yahoo but also to combine efforts to make a product that would compete with Google SUPERIOR product.

]]> 2008-06-12T23:53:56Z tag:www.readwriteweb.com,2008://1.6537-comment:57696 Comment from Darren on 2008-06-12 Darren http://crowdstatus.com some of yahoo board will lose an aweful lot fighting the lawsuits for not taking the money.

I think MS will be just fine, people are writing them off because they just don't like them.

]]> 2008-06-12T22:24:07Z tag:www.readwriteweb.com,2008://1.6537-comment:57695 Comment from Todd on 2008-06-12 Todd "What do you think are Microsoft and Yahoo!'s next moves?..."

Microsoft stock plummets to mere pennies in reaction to Steve Ballmer being committed to an undisclosed Bellevue Washington mental institution.

http://www.youtube.com/watch?v=C5oGaZIKYvo

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