Microhoo! What Does it Mean for Users?
Presuming you've seen the news that Microsoft has moved to buy Yahoo! for $44 billion, the next logical question to ask concerns what this means for users and lovers of technology.
If its business analysis you're looking for, go read Paul Kedrosky. Here at ReadWriteWeb we focus more on the cultural impact of innovation in technology. On that front, I think this acquisition could be very good news.
It's going to validate a lot of innovation at Yahoo! Many people, including Microsoft on the conference call early this morning about the news, are focusing on what this means for advertising and for search. Since when is Yahoo! particularly good at either of those things, though? Yahoo! has created a web presence with more traffic than almost anyone else on earth. That's what they are good at and the issue is that they haven't been able to make money off of it.
Yahoo! is great at content and online innovation, though. That's what Microsoft needs right now. Google is posing a threat to Microsoft not just because it is winning in advertising, where Microsoft is a relative beginner, but because Google is shifting the software world to online.
Microsoft is serious about innovation, they just haven't been doing much of it in house for awhile. The Live.com work and the Microsoft acquisitions in the health space indicate to me the company really is trying to do more than just catch up in search and advertising.
I think that this acquisition is going to mean a whole lot more energy put behind services like Flickr and Del.icio.us and innovative content sites like Yahoo! Sports and Finance. All of that will be good for Microsoft and it will be good for those of us who find those sites and services inspiring.
It's hard to know what the impact of layoffs will be, or if the Death Star culture of Microsoft will quash a lot of the Yahoo! spirit, but it's going to be a huge company and I'm hoping we will see some very cool things come out of it.
Share
Comments
Subscribe to comments for this post OR Subscribe to comments for all ReadWriteWeb posts
Don't assume for a minute that Google is going to sit passively back and do nothing.
They have every right to make their own bids to Yahoo.
Don't you think they are discussing this now?????
This analysis was pretty lame. What I normally like about ReadWriteWeb is the nice indepth analysis (compared to many other sites as Techcrunch). This analysis wasn't what I expected.
I would have thought that you'd have a better article ready for big breaking news like this, since there has been loads of rumours about this bid.
/Mattias
I think the culture in Microsoft has changed a lot, the use of blogging illustrates that. People like Robert Scoble helped demonstrate the company has moved on from the court case.
Could you not critique Google in the same way?
Microsoft has a love/hate relationship with content, though. The used to own all these content sites -- Expedia, Slate, etc. -- and they ditched them all because they're not really a content company. Even MSNBC sort of flounders under their watch.
This seems like a recipie for a huge, unwieldy behemoth.
I have to agree with Mattias, this is rather light on analysis. There are lots of ramifications for users on a wide variety of fronts. Just, for example, think of all the duplicate properties that they both own, from email to instant messaging to portals. How things shake out will be a significant determining factor in how beneficial this is to users.
Besides, part of the problem with the Googles and Yahoos of the world are the low switching code associated with using a different provider, at least when it comes to search. Yahoo, presumably, would have somewhat more user lock-in since many of their primary products actually host files or more involved services (Flickr, for example). It is hard to say where things are going now or what the next big innovation is, but it is a good bet it won't come out of Microsoft, Yahoo, or Google.
Also, regarding the first post, I doubt Google could win government approval for snapping up Yahoo due to monopoly restrictions. Google is already having enough trouble finalizing their DoubleClick aquisition and that is small beans compared to a Yahoo/Google merger.
The devil will be in the detail in how they would manage the integration. There are so many examples of buyouts / mergers that never really work as envisioned. But for the overall long term good there does need to be at least one proper decent competitor to Google, and at the moment neither Yahoo or Microsoft are managing to be that on their own. Maybe a combined Yahoo and Microsoft could provide that, then would also be nice to see a third, international search engine emerge - maybe something out of China or elsewhere could in future make a leap to become global, and hence provide a 3rd perspective to search results.
Hi Marshall,
I appreciate your views, but something inside me tells me that this deal would not go as expected if it takes place. This deal spells doom for the free web culture that we are used to for years.
Microsoft's oppressive monopolistic culture could possibily kill Yahoo and services that we have come to assoiciate Web2.0 with namely Flickr and Del.icio.us
For more on this read my thoughts at my blog here : http://dailyapps.net/2008/02/what-does-a-combined-microsoft-yahoo-look-like/
Meant for the users better experience for sure. All positive!
I dont think this will change anything.
The trick is to abstract it, so then you have a company which is all over the map buying another company which is all over the map, to compete with a company which is highly focused on one thing, ads.
Some say search, but I say that's just an excuse to show ads.
Google's philosophy, no interface equals no distractions, it's search results + ads. Period.
The rest is like the glittery stuff on a christmas tree - pretty but not important.
Can't you see what have they done with Vista and IE7? They might do the same thing with Yahoo! services.
If it happens it will be a massive blow to our collective vision of a semantic web...
Those millions of new OpenID users? - deleted.
Flickr and Upcoming Microformat support? - turned off.
YUI? - scrapped.
Yahoo Pipes? - replaced with .NET
Shall I continue?
==this is a sad day for all of the believers in yahoo, since 1994==
most of us started to web surf with yahoo; but yahoo made crucial mistakes:
1. didn't buy ebay, when they could
2. didn't buy google, when they could
3. didn't buy youtube, when they could
4. didn't buy facebook when they could
5. didn't consolidate in one powerful yahoo web2.0 platform all their properties (pretty cool individually, flickr, del.icio.us, upocoming...etc..)
this will be their destiny. yahoo will be remembered as a footnote in the history of the web, like altavista, excite, lycos...
pretty sad.
Can you imagine a bigger clash of cultures?
I have contacted a few mid level management people at Yahoo who could be described as, ‘Yahoo Purple Lifers”. They have intimated that they will stay and work to make any cultural changes to the organization, and I quote, “as painful as possible for the new Microsoft directors and division Veeps, short of insurrection”.
I’ll try and write something up on this attitude that seems pervasive, on my blog, over the weekend. There has been plenty of bitterness over the layoff’s already.
They are very different companies; although one could reason that this acquisition is the lawful and logical harvest of equity for Yahoo’s long term investors and employees with stock. But it takes more than a mere decision to make such a gargantuan move work.
They are Very Different cultures.
Marshall - I disagree that this will be good for users. The only upside I see is that there will be a mass exodus of great Yahoo Engineers into the Valley. Some will join Google and a lot will join existing startups and more will start their own. I think this will spur a wave of innovation that will eventually be good for users but not for the reasons you state.
Anyone who thinks MS will "turn off" thinks like Flickr, del.icio.us, etc. is ridiculously naive.
And I'm not really sure Yahoo! is the poster-child for "free web culture" just because they bought a couple of web 2.0 companies. They couldn't even get their own social network off the ground.
Yahoo! is basically a company with a popular portal, popular web email and a few cool consumer services like flickr and del.icio.us. They're not exactly trailblazers anymore.
Don't get me wrong - flickr is probably my all-time favorite web company.
I just think anyone that seriously thinks MS would turn flickr off is really drinking the anti-MS kool-aid to the point that it's melting your brains. :)
I think Steve Mann has it exactly right.
If ever there was an evil empire it was Microsoft. Please don't let them acquire Yahoo. God save us.
By the time the smoke clears, Google will have lapped Yahoosoft/Microhoo several times. Bad for both sides, and in the end for users, in my opinion.
All I can say is goodbye to Flickr Pro.
Now say hello to Flickr Home Basic, Home Premium, Business, Enterprise and Ultimate. Pricing is TBD ;)
If it happens this would be a great opportunity for the new Microhoo! to leap-frog google and create an Information coscious Environment. The pieces are there but can they put them together?
Blogged at towerone.com
Those millions of new OpenID users? - deleted. (Or not considering Microsoft has pledged support for OpenID)
Flickr and Upcoming Microformat support? - turned off.(Or Not considering that Cardspace could be used with flickr and those microformats)
YUI? - scrapped. (or not Microsoft could use stuff like Yui in its live properties)
Yahoo Pipes? - replaced with .NET (Dont know Dont care)
You just want an equal Opportunity to attack Microsoft
Microsoft desperately needs Yahoo to survive; however, they still do not have a chance with Google.
Shane: Funny comment on Flickr. :)
I think most onlookers would see this valuation as quite pricey. But, if you're Microsoft, you don't know how to build software anymore.
Most people tend to forget that Microsoft simply cannot innovate anymore. After all, when was the last time they released really disruptive new software.
I think the search market is going to get turned on its head by some startup at some point. And when it does, this acquisition is going to look all the more pricey.
Has anyone here seen ManagedQ? They look like they have a darn good chance of being something disruptive enough to start moving search market share around.
I admire your positive(somewhat refreshing) post on the subject, Marshall.
I disagree, however, that this could be good news- http://weareindia.blogspot.com/2008/02/api-arrogant-pricks-inc.html
You see- the problem is that Microsoft and Yahoo, additively, are still not solving any problems.
Google solved problems(a good search engine, an effective ad platform...) and if msft/yhoo had their wits about them, they'd be thinking about what unsolved problems there still are in the marketplace(and of those...there are plenty).
Quick note: Google isn't shifting the software world online. The software world IS going online, and google is just among the first to acknowledge it, and build services around/for it.
That MSFT hasn't been able to do so, yet, is to their discredit. And I doubt that a $44 billion acquisition will help them innovate, when a $100K cheque was all it took to spawn Google.
"Most people tend to forget that Microsoft simply cannot innovate anymore. After all, when was the last time they released really disruptive new software."
If you don't count Vista, Silverlight, Graphic designer, Word 2007 etc, .Net, and on it goes.
But I dare say that Google will be the winner, they will get the content providers like Yahoo7 who won't go where 9MSN lives and they will get the staff that won't hang about to see if they have jobs or not.
Microsoft's advertising rates are too high and they won't be going down while MS have $40B to pay off. Google will win them too.
MS + Yahoo will have less market share than MS and Yahoo as separate entities.
What next Apple Google? Goopple They probably have better synergy.
Yani
Yahoo by Microsoft is real. It's definitely coming....
Check out: http://yahmic.com