What’s Worse Than Microhoo? Yahoogle!

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So it looks like Yahoo is going to reject Microsoft’s bid. I, like seemingly everybody else, think the merger would be a mess (except for Google) so it’s probably just as well Yahoo may reject it.

However, what happens next could be just as troubling.

First, the shareholders may revolt (with a little help from Redmond) because they’re seeing dollar signs, so it could get ugly for Yahoo’s board. But let’s assume that’s not the case– that the shareholders believe the Microsoft deal is only short-term gain, and they’re hanging on for the long-term — than what?

Well, the article gives two possibilities. One of them is:

Yahoo is examining… ways to wrest a higher offer from Microsoft.

Yahoo claims their rejection is because the offer isn’t high enough — that Microsoft “massively undervalues” them. That’s almost laughable, so good luck with that. If Microsoft wants them bad enough I think they’d take more hostile actions, not get all sweet and up the ante when it’s already plenty.

Besides, with the initial deal rejected the board will be that much more resistant to any new deal because they know if MS takes over they’re toast. This rejection seals their fate should MS come out on top.

Yahoo and MS can play these kinds of games all they want for all I care. It will be fascinating to watch. It’s the other possibility mentioned that frightens me:

Yahoo might seek help from rivals, soliciting other bids or seeking partnerships with… Google to thwart Microsoft, according to analysts including Stanford Group Co.’s Clayton Moran.

Yes, a couple of other companies were mentioned with Google, but the search giant’s name continually creeps into this conversation. It’s almost as if a trial balloon is being floated.

The New York Times reported Feb. 4 that Google CEO Eric Schmidt contacted Yang to suggest a partnership between their companies. A partnership with Google may allow Yahoo to outsource its search service, shedding the costs of running its own search engine and sharing ad revenue with its larger rival.

I had read this, but at the time thought there may be little way for Yahoo to get out of the MS deal. If it didn’t go through I figured it would be because MS reconsidered and withdrew it. Now that it might be rejected outright, perhaps the Google talk is a bit more serious than initially thought.

While a search and advertising partnership with Google is an option, it would face stiff regulatory scrutiny,

Ya think!? Frankly, this shouldn’t even need scrutiny. You have #1 and #2 in search, people. This is a no-brainer, can’t-let-happen scenario.

The U.S. Justice Department is “interested” in reviewing the antitrust implications of a Yahoo-Microsoft transaction,

If the DoJ is only “interested” in reviewing a Yahoo-Microsoft transaction, then I would think they’re peeing their pants at the thought of a Yahoo-Google agreement.

Look, those who read this blog know I’m no fan of Microsoft. There are numerous reasons for this that would entail an article of their own (or the ones I’ve already written). But that doesn’t mean I’d rather Yahoo be in bed with Google.

Bottom line is I don’t want to be so busy in a perceived thwarting of the monopoly of the 90’s that I’m too stupid to see I’m building the monopoly to replace it.

Google is already getting close enough to keep an eye on. I’m not sure I’d be happy with even so much as a handshake between them and Yahoo. There is far too much that can be done behind the scenes.

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3 thoughts on “What’s Worse Than Microhoo? Yahoogle!

  1. Pingback: BLOG LATINOS » Blog Archive » Yahoo rechaza a Microsoft

  2. Change the search engine to what? After Yahoogle there may not be a decent one left.

    Besides, people can change their web browser in minutes, too, but guess what? They don’t. Hence IE still has 80% and Firefox pats themselves on the back for a relatively paltry 14%.

    And at least with browsers I know which one I’m using. With search, 99.9% of people will have zero idea of knowing just what goes on when they hit enter. The beauty of search — to find even the “little guy’s” site — can and likely will be corrupted into only revealing the highest “bidders”, no matter in what form those “bids” take.

    In fact, the ease with which a search could be corrupted is almost frightening. And you would have a huge hand in controlling what people see, so it’s not just limited to a money grab either. It could be used as a tool to shape public opinion about a great many topics.

    Microsoft may or may not “destroy” Yahoo. But I have no doubt a Yahoo-Google alliance would become an enormous entity that would eventually have to be disassembled. Absolute power corrupts absolutely.

  3. Well the thing I really hated about the Yahoo/Microsoft merger is that Microsoft would destroy Yahoo while embracing it. The various portal services, Flickr, Delicious, etc, would be endangered, and I really didn’t want that to happen.

    Yahoo/Google is just an advertising contract and so nothing would be destroyed, except insofar as Yahoo’s businesses were troubled and had to be closed/dismantled.

    So if I had to choose between the two, I would prefer Yahoo/Google to Yahoo/Microsoft.

    I don’t think the search business has as high a barrier to entry as you might think. The fact that Microsoft could not break through Google’s success indicates that better search and a good corporate personality count for more than monopolistic advantages.

    You can change the FireFox or Safari default search engine in minutes …

    D

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