Filed under: Deals, Industry, Competitive strategy, Microsoft (MSFT), Yahoo! (YHOO), Goodyear Tire and Rubber (GT)
Hundreds of stories have been written over recent weeks about the plans of Microsoft (NASDAQ:MSFT) to buy Yahoo! (NASDAQ:YHOO) and Yahoo!’s plan to out-source its search to Google (NASDAQ:GOOG). At the end of the day, the are all speculation backed by very tiny fact.
More “news” about the deals came out overnight. According to Bloomberg “Yahoo may concur to use Google’s Web advertising software within a week.” The Wall Street Journal writes that “Microsoft Corp. late Thursday was leaning toward going hostile in its pursuit of Yahoo Inc.”
All of this is great theater because both stories might be true and the entire situation could dissolve into a cauldron of competing companies, investment bankers, and corporate boards each competing for leadership in the internet search market.
Who is served? In this case, for once, the shareholders. Yahoo! could take a deal to have Google handle its search and search advertising features. Depending on which analysis Wall St. wants to believe, this should save the portal hundreds of millions of dollars a year, if the government will approve an alliance between the two largest search companies.
On the other hand, Microsoft may raise its bid in an attempt to tempt shareholders to take $33 or $34 for Yahoo!. The company’s shares traded around $20 before Redmond made its offer.
The media might have months of fun ahead of them A proxy fight could drag on and on as could a government decision about whether Yahoo! and Google can form a search venture.
At the very least, its sells newspapers.
Douglas A. McIntyre is an editor at 247wallst.com and the author of the Ten Stocks Under $10 newsletter.
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