Today I want to do some reflection on the case of fusion (non-) Microsoft - Yahoo! . First
delivery with the brief summary of the two famous infotech companies.
delivery with the brief summary of the two famous infotech companies.
Microsoft Founded by Bill Gates in the 70's is the largest global computer giant. A market capitalization of $ 270 billion, annual sales of $ 51 billion, net income of $ 14.6 billion, 79,000 dipedenti and a business model that is (slowly) fading (computer software "local").
Yahoo!
Founded by Jerry Yang (current CEO) Flo and David in 1995, is one of the few born in the internet boom to have survived the internet bubble. Capitalization at the time, more than $ 43 billion, waiting to see how lost in session today after the official retirement of Steve Ballmer, CEO of Microsoft, out of the deal for the request too Yang. It has a turnover of about $ 7 billion, and net income of about $ 1 billion. Its business model (free service with premium options and contextual adv) work and Yahoo has a strong expertise in the area of \u200b\u200bthe web, a brand interesting and "friend" of users.
Well, what happened?
Steve Ballmer in February 2008 provided $ 44 billion for buy Yahoo, 60% more than the value of the company stock at that time (Make or Buy Decision : MS chose BUY ).
Among the various options available to MS, it was decided to proceed with the merger of the road "consensual", which would allow both companies to complete the transaction in the best way, and without losing valuable items in the street taken away by competitors.
Problem
Yang MS examination of the offer is too low for the real value of the company. The operation was then extended up to the last few days in which the agreement is blurred. According
a letter from Ballmer last match the price offered had risen to $ 47.5 billion, for a total of $ 33 a share. The party demanded instead $ 37 and the agreement fell through.
The lost opportunity
The fuzzy fusion of the two companies in my opinion, a lack of opportunity to offer the market a more competitive player in the market to counter the domination of Google's online search and Advaita .
can do strange to hear it, for "fan" of Google (of which I feel part = P), but the market dominance of the Web is not Microsoft let alone Yahoo! , but Big G.
All information is confirmed and is now a fact that Google has become "the gateway to the web" .
such a strong position and with a gap so evident from the competition is set up as a monopoly (although this is the shape of the market): Big G controls 68.6% of U.S. search, compared to 17% of the first competitor (Yahoo) and 8% in the second (MSN / Live) - Source: Compete .
From this it is clear how important the online market of Advaita, which is growing at double-digit annual percentage rates (40% in Italy since 2007 for a total of 680 million €) and is expected to reach € 1 billion by 2008 (estimates and data IAB).
Future
What one expects to happen now? MS has put into the pot $ 47 billion. If you look back on an agreement on that figure, some of the money could be invested in the internal development of new business model (remember that we started from the Make or Buy Decision ? Now we head towards the MAKE ).
Another possibility is that institutional investors and major shareholders Yahoo! put pressure on Yang to CDA and they retraced his steps down the claims to reach an agreement with MS a figure around that originally proposed by Steve. It 's a little back with his tail between his legs after he had "done the cool, pass me the term.
road may be the final agreements with Google ace or catch-interest situation, a Rupert Murdoch , an acquisition that it will host and MySpace .
What do you think?
Tiziano Tassi
CLAM 3rd year
Notes: Photo by Flickr
