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Open Sources | Rodrigues & Urlocker » Microsoft offers $44.6 billion for Yahoo

February 01, 2008 | Comments: (0)

Microsoft offers $44.6 billion for Yahoo

Ok, who knew that this week's earlier deals were just a precursor to Microsoft making an acquisition offer for Yahoo! It's been clear for a long time that Microsoft was running in third place (or later) in many of the new markets like search and online advertising. By making an offer for Yahoo, Microsoft is attempting to gain ground and catch up to Google. Rumors of this deal had surface in the past year, and Terry Semel's resignation from the board may have been a recent clue to board room dissent.

This kind of a mega-deal has lots of complexities to it. There are overlapping technologies and conflicting strategies that can make it difficult to execute. And that's assuming that Yahoo agrees to the terms and that US and European legislators approve the deal. So we are still a long way from certainty on this one.

It's interesting to see what happens to some of the open source focus at Yahoo. Will Microsoft continue to move forward with technology like Zimbra that Yahoo acquired last year? (If they're smart, they should --it's more scalable than Exchange and gives Microsoft the opportunity to reach beyond just Windows.) And who knows maybe this one acquisition could make Microsoft a more open company...

At this stage there are mostly questions. So what do others think of this deal? Should Yahoo accept? How should things be integrated?

Posted by Zack Urlocker on February 1, 2008 08:23 AM


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Oh no. Please no. I like yahoo. I don't want it turning windows-esque. If this happens they'll have to restart, and reinstall yahoo once a week. Emails will go to the wrong places, and it will start doing (and not doing) stuff all on its own.

On the other hand, I wouldn't say no to 44 billion.

Posted by: blargumentor at February 1, 2008 11:44 AM

If you are wondering what Microsoft will do with Zimbra, you should do a YAHOO search for "Hotmail acquisition". The First thing Microsoft did was to go to the data centers and remove the face plates from the SUN servers that were running Hotmail's infrastructure then they spent a few years and a lot of money making sure that their service is not running on anything but Microsoft products.

I doubt that buying a competitor will "make Microsoft a more open company". It is more probable that they will look for the next competitor they need to take out before Google buys them.

Also Zimbra was not an alternative to Exchange the way PostPath is. In a few years, we will look back and think of Zimbra as an innocent bystander that got killed in the cross fire.

Posted by: max at February 1, 2008 03:32 PM

I hope Yahoo shareholders will give Yang some time to rebuild Yahoo, this deal may not help Yahoo in the long run, Microsoft just does not yet proof that it can manage an online property well.

Posted by: dotservant.com website hosting at February 2, 2008 07:42 PM

It means Microsoft have failed to compete their competitors.

It'll be a big news for this year 2008. If a company appears with tag "MicroYahoo" in the technology map.


Safdar Imam

Posted by: Safdar at February 3, 2008 03:20 AM

Microsoft won't foster Zimbra, they will starve it of resources and try to kill it off.
It's emerging as a serious competitor to Exchange and they'll sacrifice it at the stake rather than let any upstarts challenge one of their flagship products.

Posted by: Andrew at February 3, 2008 09:37 PM

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