Filed under: Deals, Competitive strategy, Google (GOOG), Microsoft (MSFT), Yahoo! (YHOO)
A memo by a senior Microsoft (NASDAQ: MSFT) executive sets out some of the reasons for the company’s bid for Yahoo! (NASDAQ: YHOO). According to The Wall Street Journal (subscription required), “Kevin Johnson, president of Microsoft’s Platforms and Services Division, reiterated the Redmond, Wash., software maker’s reasons behind its unsolicited offer, writing that a combination would provide a compelling alternative in search and online advertising.” The note goes further to indicate that Microsoft values both the Yahoo! brands and the technical skills of its engineers.
Yahoo! should not take the memo seriously. It would be hard to name a company that Microsoft has purchased that still maintains its own brands and independent operations. Bill Gates has stated that the software company will put its full engineering skill behind an effort to build superior search technology than Google (NASDAQ: GOOG) has. It might be an audacious and arrogant approach to catching the industry leader, but Microsoft has never looked for outside help to solve its most important problems.
All Yahoo! shareholders can look for in the generous Microsoft buy-out offer is a good payday. The world’s largest software company looks at Yahoo! as a step in advancing its own agenda and nothing more.
Douglas A. McIntyre is an editor at 247wallst.com.
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