- A retraction of the bid by Microsoft, or
- A hostile bid for Yahoo!
Personally, I don't think that either will happen, but I do believe that Microsoft cannot walk away from this deal. So, how do you reconcile this: an all-cash-offer. Microsoft's bid for Yahoo! is in stock; Yahoo! has been adamant that its offer is too low and Microsoft has been equally stubborn on its stance not to increase its offer. By offering an all-cash bid in lieu of its stock-bid, Microsoft could make its offer a little more enticing as well as offer Yahoo! an 'out' without forcing a hostile action by its soon-to-be owner.
Microsoft needs Yahoo! Google has already made its quasi-white knight intentions clear and Microsoft certainly cannot afford to let Yahoo! slip into the hands of its arch rival. It will be interesting to see what happens next from both a business perspective as well as from the perspective of a consumer.
I'm both a Yahoo! user and Google user. I don't really use MSN's search offer, but do enjoy its homepage as a news aggregator. A merging of some search and rich-content could very well help Microsoft take a dominant position in the market. In terms of display ads, the mere purchase of Yahoo! by Microsoft will make it bigger than Google in this arena, but I think that its true success will come from leveraging the synergies that these two future siblings can offer together in providing us lowly surfers with an even better way to spend our time online.
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