Over 30,047 people are online! Join now and start making friends!

Talas Blastmor's blog: "TECH."

created on 07/01/2007  |  http://fubar.com/tech/b97754
Over the past few months, we've been inundated with constant stories about the future of Yahoo. Will it be gobbled up Microsoft? Will Yahoo get away? For quite a while, no one was quite sure. But after seeing what's going on with Google and the deal it may soon strike with Yahoo, the writing could be on the wall. Last week, Yahoo announced that it had formed a temporary deal with Google that involved the company outsourcing its search ads to Google. At that time, the online firm said that it would give it a two-week trial period to see how it worked and make a decision after that time. But after foregoing that two-week stipulation and deciding instead to try to form a deal now, Yahoo seems anxious and more willing than ever to sell itself to any other company but Microsoft. According to the Wall Street Journal, Yahoo and Google are closer than ever to forming a deal that would see Yahoo increase its revenue by as much as $1 billion per year and throw a wrench into Microsoft's plans post-acquisition. And while the Journal is reporting that the Yahoo-Google deal may have a stipulation in it that says it can be dissolved if Microsoft acquires the company, I'm not so quick to believe that any deal between the company won't put the hooks in Microsoft. And if you ask me, when the deal is reached, Microsoft will be forced to back off. So why do I think Google is such an important part of the deal with Yahoo and Microsoft? It's simple -- Google is Microsoft's arch rival and neither company wants anything to do with the other. And because Google doesn't want to see the merger happen, it knows that this sweetheart deal with Yahoo could turn the tide. But let's also not forget that Microsoft doesn't want to see the Google deal happen either. Last week, the company said that it was extremely displeased by the development and thought it would be bad for all parties involved. "This would make the market far less competitive, in sharp contrast to our own proposal to acquire Yahoo," Microsoft said. "We will assess closely all of our options. Our proposal remains the only alternative put forward that offers Yahoo! shareholders full and fair value for their shares, gives every shareholder a vote on the future of the company, and enhances choice." Let's face it -- Microsoft is not naive to what's really going on with the Google deal and it understands the ramifications if such a deal is struck. Not only would it be forced to call in reinforcements to get some of the fence-sitting shareholders back on its side, it would need to figure out exactly what it can do after the Google deal is made. Right now, Yahoo is dealing with a relatively hostile group of shareholders that would like to see the Microsoft deal get done. That said, they're unhappy with the fact that Microsoft's lower stock price has diluted the value of its offer from $31 per share to about $29 per share. Because of that, some shareholders that were firmly in Microsoft's corner have been asking for more cash and Jerry Yang and company has been able to fend off any pressures so far because of it. That said, Microsoft is unwilling to increase its cash offer right now and believes (rightfully so) that it shouldn't bid against itself. But what Microsoft may have failed to realize is that Yahoo is doing all it can to find other ways for Microsoft to bid against itself. Aside from the deal with Google, Yahoo is desperately trying to seek suitors and so far, AOL has shown the most interest. And although it won't be acquired outright, Yahoo would allow Time Warner to take a 20 percent stake in it and totally change the dynamics of the entire industry. So far, no deal has been reached with Time Warner, but let's not forget that a deal with Google could make it easier. After finding $1 billion in a deal with Google, Yahoo suddenly becomes a far more attractive target for Time Warner and many others that wouldn't mind working alongside Google. With that, Yahoo can finally acquire some leverage and use Microsoft against itself to get out of its stranglehold. Here's how I see it happening: Google and Yahoo will form a deal by the end of this week or early next week. After that, Microsoft will come out and say that the deal is an extremely ridiculous move on the part of the Yahoo executives and just another example of the company's managers not knowing what to do. After announcing to shareholders on April 22nd when it's forced to reveal its earnings that the Google deal has been struck and should bring in an additional $1 billion per year, some of those leaning on the fence that are already upset with the diluted Microsoft acquisition price will give Yang and shareholders a reprieve and wait to see what happens. After that, companies that are more willing to work with Google (like Time Warner) will get serious in their talks with Yahoo management, which suddenly has a new lease on life, and will offer Yahoo deals that will make Microsoft sweat. Upon realizing that its support is eroding and it has no real prospects to acquire Yahoo without a ridiculous sum of cash, Microsoft will back out and this whole saga will end. Will this definitely happen? Who knows. But if Yahoo plays its cards right and can strike deals at the right time with the right companies, Microsoft will have a problem. Now back to your regularly scheduled soap opera.
Leave a comment!
html comments NOT enabled!
NOTE: If you post content that is offensive, adult, or NSFW (Not Safe For Work), your account will be deleted.[?]

last post
4 years ago
posts
238
views
23,172
can view
everyone
can comment
everyone
atom/rss






other blogs by this author

 3 years ago
FUNNY
 3 years ago
Astronomy
 3 years ago
NEWS
 3 years ago
QUOTES
 3 years ago
MUSIC
 3 years ago
Science
 4 years ago
Pictures
 4 years ago
Video
official fubar blogs
 1 year ago
fubar news by babyjesus 
 12 hrs ago
e by e 
 12 hrs ago
e by e 
 3 years ago
fubar.com ideas! by babyjesus 
 1 year ago
Word of Esix by esixfiddy 

discover blogs on fubar

blog.php' rendered in 0.2127 seconds on machine '219'.