If you can’t beat them, buy them
This is literally what Microsoft did after more than a decade of failure to catch up with the quickly evolving web world. They are making the biggest bid in the technical world ever to acquire Google’s rival, Yahoo!. Shall such a deal go on, Microsoft would finally be #1 in the WWW customer base, and Ballmer would finally see his dream come true. Beat Google that is! I think they must have thought of this after their protest on Google acquiring DoubleClick failed. This must have been a strong hit and they wanted to strike back in any way they could. Major acquisitions also have been the latest fashion. BEA and MySQL both acquired last month, so why not Yahoo! this month? After all, they have been lacking for the past few years.
But is it a wise thing to acquire a deteriorating company instead of emerging one? In the technology world, it’s about what smart people you hire, and looking at this story, companies like Google and Facebook seem to be getting all the attention of fresh talents, while Microsoft is not anymore the dream of programmers, and Yahoo is not even close to Google. Merges of falling down companies could go real bad. Look at AMD & ATI merge and how terrible it turned out to be, and they are still suffering from it. Such major acquisitions could be really harmful not only to the end user, but to the acquiring company as well.
Either ways, Google obviously is not happy about the attempted acquisition, and is fighting it from both ends. Publicly, they went with the predicted monopoly protest statements, describing how the take over would seriously hurt the global market fair competition, and without any doubt, they are absolutely right there. Especially when the acquisition is coming from Microsoft. From the shadows however, instead of making their own bids as it would contradict their monopoly protest, news have surfaced about Google’s Eric Schmidt calling Yahoo’s Chief to co-operate in backing off Microsoft offer, probably by reaching partnership agreement, something which could be appealing to Yahoo!. Google have also been making contacts with other companies, like Time Warner, looking for possible Microsoft rival bidders. Alas, none seems interested in a lost battle against a company as large as Microsoft.
I personally have been feeling real bad about competitor acquisitions, such as Oracle and BEA. It really cuts down the choices and give the company control over pricing and portability. Yahoo!’s fall to Microsoft would be even more devastating and harmful to much larger segment. And the thing that worries me the most is Yahoo! logically saying that they will “pursue the best course of action to maximize long-term value for shareholders.”. That said, you can only imagine how $44.6 billion looks compared to annual $4.13 billion in profits.
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