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Microsoft Makes $44.6B Bid for Yahoo

by , 7:50 AM EST, February 1st, 2008

Microsoft took a big swing at Internet giant Google on Friday when it presented a US$44.6 billion buy out offer to Yahoo. The two companies have not been able to overtake Google on their own, but acquiring Yahoo would put Microsoft in a much more competitive position.

Microsoft CEO Steve Ballmer stated "We have great respect for Yahoo, and together we can offer an increasingly exciting set of solutions for consumers, publishers and advertisers while becoming better positioned to compete in the online services market."

Google's strong position in the online search and advertising market has left Microsoft and Yahoo in the dust despite both companies efforts. By combining forces, Microsoft hopes to be able to take a bigger slice of Google's online advertising pie.

Microsoft's Platforms & Services Division president Kevin Johnson added "The industry will be well served by having more than one strong player, offering more value and real choice to advertisers, publishers and consumers."

Microsoft expects that the online advertising market will climb to $80 billion by 2010, doubling the $40 billion market of 2007 -- and by buying Yahoo the company projects it can generate an additional $1 billion a year, or as Microsoft called it, "annual synergy."

The acquisition offer comes only days after Yahoo reported a 23 percent drop in earnings, warned investors that the rest of 2008 didn't look promising, and announced that it was laying off about 1,000 employees.

The Redmond company isn't expecting any regulatory issues and, assuming Yahoo's Board of Directors and shareholders approve the deal, hopes to complete the half cash-half stock transaction in the second half of 2008.

Observer Comments

Show: Subjects Only | Full Comments
Close Name:grshaner Posts: 18 Joined: 07 May 2004
Subject: Like a Rock . . .

I will drop my Yahoo email account like a rock if this actually happens. All Gmail all the time.

I was listening to the latest episode of TWiT this morning, and heard Dvorak say that using Macs and PC's you get the impression that Bill Gates doesn't USE a computer anymore and that Steve Jobs does.

I fear what Yahoo! Mail will be like run by a guy who doesn't use it. No thanks!

View Name:Guest
Subject:
Close Name:Sir Harry Flashman Posts: 581 Joined: 08 Feb 2007
Subject: Isn't Gates out of the picture

Quote
grshaner wrote:
I will drop my Yahoo email account like a rock if this actually happens. All Gmail all the time.

I was listening to the latest episode of TWiT this morning, and heard Dvorak say that using Macs and PC's you get the impression that Bill Gates doesn't USE a computer anymore and that Steve Jobs does.

I fear what Yahoo! Mail will be like run by a guy who doesn't use it. No thanks!


I am sure he still has influence, but isn't Bill Gates pretty much retired from running MicroSoft.

Anyway, I wonder how this deal, ere comes to fruition, will affect me. I have DSL from AT&T and they are tied in with Yahoo. The web page where I manage my account is yahoo.com. Other than service related notices from AT&T I don't really use the email addresses they give me as part of my service, but my SMTP servers are att.yahoo.com.

View Name:Guest
Subject:
View Name:Guest
Subject: Microsoft + Yahoo = Microhoo?
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