If you wanted a piece of hardware in January and thought it was necessary, would you be thrilled that it now costs only one third of the price at the beginning of the year? Of course, you would be. And perhaps, if the ‘Geek Force’ is strong, you might buy two of whatever it is.
It is a significant shift for Yahoo. The CEO of Yahoo, Jerry Yang, is stepping down:
“…Yang, 40, will step down as CEO and return to his former role as “Chief Yahoo.” The company’s board said it has hired headhunter Heidrick & Struggles to find a replacement.”
The partnership with Google was a means of generating much needed revenue for Yahoo and buffering any further acquisition attempts by Microsoft. The project seems to have been ended prematurely with Google removing itself:
“Google has decided to abandon its advertising partnership with Yahoo to avoid having a “protracted legal battle” with regulators.
The deal involved Google providing some of the advertising around Yahoo’s search results and would have been worth $800m (£494m) a year to Yahoo.”
link: Google abandons deal with Yahoo
This makes Yahoo vulnerable. It would not be surprising to see Microsoft make another offer to Yahoo. If Microsoft holds to form, the offer will be made on a late Friday - just to add pressure to the situation.
Catherine Forsythe
There is support for the Google / Yahoo Advertising plan in the House of Representatives:
“…The lawmakers, all Democrats from California, urged the DOJ not to block the ad deal, in which Yahoo would run some Google search ads on its Web pages. The group sent a letter to the DOJ Friday.”
link: Lawmakers call on DOJ to approve Google-Yahoo deal
For Yahoo, this advertising arrangement is imperative. It allows Yahoo to generate income along with Google and it gives Yahoo a financial buffer. The possibility of a Microsoft acquisition of Yahoo still lingers; and Yahoo knows that Microsoft is waiting for an opportunity to revisit the possibility of a Yahoo merger.
Catherine Forsythe
Best Buy has bought one of the old, familiar names of online music. Napster is now part of Best Buy:
“NEW YORK – Consumer electronics retailer Best Buy Inc. said Monday it will acquire online music-sharing site Napster Inc. for about $126.8 million in cash in a move to boost its digital media capabilities.
Best Buy will begin a tender offer for all outstanding Napster shares for $2.65 per share, representing a 95 percent premium to the stock’s closing price Friday of $1.36 per share.”
link: Best Buy will acquire music-sharer Napster
With social network sites like MySpace offering music to its audience, Best Buy has joined a very competitive sector. At the price paid, it is questionable whether the Napster acquisition is the ‘best buy’ at this point.
Catherine Forsythe
If spending is any hint of a possible future target, Google has blogging in its sights:
“Google Inc has bought Korean blogging software developer Tatter and Company, the two companies said on Friday.
The companies did not disclose how much Google paid for the acquisition.”
link: Google buys Korean blogging software company
The acquisition gives Google an immediate test market in Korea. There is little doubt that Google has a more ambitious plans. Google recognizes that the blogging market is growing (for example, see Chris Pirillo’s growing ‘geek’ community) and there are greater advertising opportunities available. Those bloggers translate into dollars.
Catherine Forsythe
In a move that is certain not to please Yahoo CEO Jerry Yang, Carl Icahn becomes part of the Yahoo Board of Directors. This is the Carl Icahn who openly campaigned for the sale of Yahoo to Microsoft. He was scathing in his criticism of the actions of Yahoo in preventing Microsoft’s acquisition. Now, he is part of the inner operations of Yahoo:
“…Carl Ichan, a corporate raider and proponent of the takeover, was elected to the board as part of a previously agreed truce between him and the company. He also will be able to recommend two additional members.
Ichan saw his election to the board as a compromise as he realised he could not win a proxy fight to remove the whole board. If Microsoft – or another potential buyer - returns to the negotiating table, Ichan will be in a stronger position to influence the outcome.”
link: Yahoo admits true scale of shareholder rebellion against Yang
If there was any question whether Microsoft has ended its pursuit of Yahoo, this strategic advantage should answer that query. Carl Icahn provides Microsoft with a direct link to the individual positions of each member of the Yahoo Board of Directors. Jerry Yang is left with the strong possibility of strong dissent from within his company directors. It becomes constant, relentless pressure from Microsoft.
Catherine Forsythe
The on-again off-again on-again acquisition of Yahoo by Microsoft took a decidedly hostile turn. Microsoft has set conditions that include having the Yahoo board of director’s tossed:
“Microsoft set the stage for a full-blown battle to overthrow Yahoo’s board of directors on Monday when it declared it was interested in reopening talks to buy all or part of the internet company – but only if a new board was appointed first.
The intervention, less than a month before Yahoo’s annual meeting, gives backing to the flagging efforts of activist investor Carl Icahn to unseat Jerry Yang, Yahoo’s chief executive, and the rest of the board that failed to reach agreement on Microsoft’s earlier takeover offer.”
link: Microsoft steps up battle over Yahoo board
It seems that one of the prime targets of this condition is Jerry Yang, the co-founder and CEO of Yahoo. Microsoft seems to want to eliminate Jerry Yang from future negotiations. No one has a greater personal and professional interest in Yahoo success than Jerry Yang.
This latest Microsoft condition effectively nullifies any spirit of co-operation. It is questionable whether eliminating Jerry Yang from the process and the guidance of the company is in the long term best interest of Yahoo, whether it is acquired by Microsoft or not. One can’t help but wonder if this latest gambit is motivated by ego on Microsoft’s part. Microsoft was not successful in its preliminary efforts to take over Yahoo. Now it seems that this extends further than business. It has become personal and acrimonious.
Catherine Forsythe
