Tags: Boomtown, Carol Bartz, yahoo
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Boomtown has a post speculating that Carol is taking the :bull by the horns” and charging hard to make changes. First up an earnings call that will surely be a bad report.
In the NFL they talk about franchise players. In business and startups they talk about the management team. Here Yahoo has one clear short term goal – GET A TEAM. More importantly get some ‘franchise players’.
There are more than a few great and wacky ideas that Yahoo could do, but if were advising Carol I’d say focus on the management team first. Overhaul that team. Waive all the people not performing, get a great staff, trade for players who want to play for you, and sign some fresh new talent.
Remember Yahoo still has a great revenue stream and a massive user base. Get the management and players then make the big moves.
Yahoo Keyword: Arbitrage – A Yahoo BiD Coming From Investment Group ? It’s About Damn Time January 7, 2009Posted by John in Technology.
Tags: Micosoft, Mike Arrington, techcrunch, yahoo
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Mike Arrington has a report that a group of investors are circling Microsoft for money to take over Yahoo. Finally, someone is making a run at Yahoo. The wounded beast is begging for a takeover and what a bargain that would be. I would love to have the cash to take over Yahoo. Yahoo has amazing assets.
This is the easiest arbitrage and the best investment if the group can get the company at the right price. Also a huge win for Microsoft. I am happy to see some life in the technology financial markets. This would be a fun deal to work. Can’t wait to see the debate – obviously I have an opinion with a ‘capital O”.
A group of well known Silicon Valley executives and top investment bankers are putting together a Yahoo takeover deal that would be financed largely from debt supplied by Microsoft, we’ve learned from sources with knowledge of the proposed transaction.
Under the terms of the proposed deal, the investment group would make a takeover bid for Yahoo at a relatively low premium of around 20% to its current price of around $13 per share, valuing the company at just over $20 billion.
Simultaneous to the transaction Yahoo’s search and search marketing business would be sold to Microsoft. Following the transaction the new executive team would take over the top ranks of Yahoo. A key goal of the new team would be to attempt to attract back much of the executive talent that has fled Yahoo in the last year.
Tags: yahoo, Yahoo Turnaround
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The what to do with Yahoo debate is raging, but this isn’t rocket science. Fixing Yahoo is so easy and clear.
Gets someone with “testicular fortitude” to pivot quickly. Yahoo is huge in numbers and they have a gigantic platform.
Step 1: reshuffle the cards in the management ranks
Step 2; operate efficiently – get lean and mean emphasis on mean
Step 3: nail 3 great new freaking products in the next 12 months
Step 4: server the users by providing better navigation on and off site
Step 5: get advertising yields up both to advertisers and publishers
Step 6: compete, compete, compete
Step 6: promote anyone internally that drives the above steps
Step 7: fire anyone who gets in the way
Step 8: Go to Step 1
Remember the old saying – anyone who isn’t part of the solution is part of the problem.
Culture issue: get a leader who has guts, understanding of internet infrastructure and advertising, and platforms.
All Yahoo employees starting at the top all the way down to the bottom need to get an attitude and COMPETE !!!
I say don’t sell to Microsoft and turn that ship around (Kara Swisher has a good post on what Microsoft is trolling for). Forget the trickled layoffs. Move fast and compete.
This isn’t rocket science folks – It’s easy – a layup.
Yang Is Forced Out At Yahoo – No Question About It November 18, 2008Posted by John in Technology.
Tags: jerry yang, Kara Swisher, Mike Arrington, yahoo
Mike Arrington has the post up with a release from Yahoo. I think that founder should stay and be supported. Me being the arbiter of all things scoops in tech has to give a shout out goes to Kara Swisher first broke the story here. Then pulls out the magic again by getting the internal memo (see below).
There is no question in my mind that Jerry Yang was forced out of town on a “rail”. I hate to see this, but the mob got him. All that value flushed down the market toilet. Personally, I was cheering for Jerry and hoped he could put it together. Hopefully this could give him some cover. Maybe the search will take a long time.
Remember that Steve Jobs was supposed to be the interim APPLE CEO.
Here is the release from Yahoo
The press release:
Yahoo! Conducting Search for New CEO
Co-Founder Jerry Yang to Step Down Following Appointment of New CEO
and Return to Former Role as Chief Yahoo! and Board Member
SUNNYVALE, Calif., Nov 17, 2008 (BUSINESS WIRE) –
Yahoo! Inc. (Nasdaq:YHOO) today announced that its Board of Directors has initiated a search for a new Chief Executive Officer. Jerry Yang, co-Founder of Yahoo!, has decided to return to his former role as Chief Yahoo! upon the appointment of his successor as CEO, and he will also continue to serve on the Board. Yang, 40, assumed the CEO role at the Board’s request in June 2007, and he has led Yahoo! through a strategic repositioning and transformation of its platform.
Chairman Roy Bostock, working with the independent directors and in consultation with Jerry Yang, is leading the process of assessing potential candidates and determining finalists for consideration. The search will encompass both internal and external candidates, and the Board has retained Heidrick & Struggles, a leading international executive search firm, to assist in the process.
“Over the past year and a half, despite extraordinary challenges and distractions, Jerry Yang has led the repositioning of Yahoo! on an open platform model as well as the improved alignment of costs and revenues,” said Roy Bostock. “Jerry and the Board have had an ongoing dialogue about succession timing, and we all agree that now is the right time to make the transition to a new CEO who can take the company to the next level. We are deeply grateful to Jerry for his many contributions as CEO over the past 18 months, and we are pleased that he plans to stay actively involved at Yahoo! as a key executive and member of the Board.”
“From founding this company to guiding its growth into a trusted global brand that is indispensible to millions of people, I have always sought to do what is best for our franchise,” said Jerry Yang. “When the Board asked me to become CEO and lead the transformation of the Company, I did so because it was important to re-envision the business for a different era to drive more effective growth. Having set Yahoo! on a new, more open path, the time is right for me to transition the CEO role and our global talent to a new leader. I will continue to focus on global strategy and to do everything I can to help Yahoo! realize its full potential and enhance its leading culture of technology and product excellence and innovation.”
Internal Memo from Jerry Yang to all employees
Kara Swisher has the internal memo from Jerry Yang to fellow Yahooers… This is pretty epic and so sad. I can’t believe that Yahoo can’t get their shit together to support their founder.
o: all yahoos
i wanted to address all of you on the news we’ve just announced. the board of directors and I have agreed to initiate a succession process for the ceo role of yahoo!. roy bostock, our chairman of the board, is leading the effort to identify and assess potential candidates for consideration by the full board. the board will be evaluating and considering both internal and external candidates and has retained heidrick and struggles to help in this effort.
i will be participating in the search for my successor, and i will continue as ceo until the board selects a new ceo. once a successor is named, i will return to my previous role as chief yahoo and continue to serve as a director on the board.
last june, i accepted the board’s request that i assume the ceo role to restructure and reposition the company as a whole in order to more effectively meet the fast-changing needs of both users and partners. since taking on the ceo role, i have had an ongoing dialogue with the board about succession timing. thanks in large measure to your tireless efforts, we have created a more open, competitive yahoo! and we believe the time is now right to transition to a new ceo who can take the company to the next level.
despite the external environment we face, the fact remains that yahoo! is now a significantly different company that is stronger in many ways than it was just 18 months ago. this only makes it all the more essential that we manage this opportunity to leverage the progress up to this point as effectively as possible. i strongly believe that having transformed our platform and better aligned costs and revenues, we have a unique window for the right ceo to take ownership over the next wave of mission-critical decisions facing the company.
all of you know that I have always, and will always bleed purple. i will always do what I think is right for this great company. while this step will be an adjustment for all of us, i know it’s the right one. i look forward to updating you on this process as soon as the board has developments to share, and will continue to do everything i can to make yahoo! fulfill its full potential.
Jerry: I am available to take over as CEO. Let me know when the interviews start. Time to clean house.
Yahoo Going Open at the Yahoo Press Open House September 11, 2008Posted by John in Technology.
Tags: Kara Swisher, Open, yahoo
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Kara Swisher is at the Yahoo event back in the trenches live blogging the Yahoo even.t Thanks Kara. Love the title of her post – Liveblogging From Yahoo’s “Open House”: Open Ads, Open Mobile, Open Open!
Guest what the theme is for the Yahoo makeover? A) Open, B) Open, C) Open, or D) All of the Above?
I wrote in January that Yahoo just go open. Glad Jerry and team have been working hard to followup from that post. Bout time guys and gals.
If Yahoo is so open why is this such a closed event?
Love the line Yahoo was open before it was cool.
Intel Yahoo Announce Platform for Web TV August 21, 2008Posted by John in Technology.
Tags: Intel, Widgets, yahoo
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Intel and Yahoo announced a partnership (also with Comcast) that they will be providing the embedded technology for set top boxes to provide widget for a TV environment. I’m here at IDF and had a chance to talk to a few Intel super geeks and basically it’s all vapor at the moment. It’s mainly a developer oriented showcase so it’s not meant to be a shipping product. The demo they are showing is very sexy but it’s vapor – at least for now.
The demo really shows the benefit of the user experience. The notion of having prefabricated widgets coming from Yahoo will make for a compelling experience. What’s more interesting is the idea that users or families will be able to create their own widgets. I can see this really working well for parents putting together microcontent widgets for their kids – a kinda set top box playlist concept.
So as of today it’s concept and this offering should attract developers with the open architecture. The Intel guy said that developers can integrate any clients side innovation directly into the stack. This makes sense for emerging areas that need innovation – like video acceleration and other problem areas like managing the storage issues. Today big video content providers have to to store multiple file formats like Flash, Windows, and Silverlight. This is a big problem and generates a ton of costs. At least the CDNs can make more money.
I love this concept with the Intel set top box and think that this is where Yahoo needs to be successful. By pushing out content from their system to the edge the users are happy. Yahoo goes to where the users are instead of today where Yahoo makes the users come to them.
The question in my mind is what is the video user experience like when there are so many problems in delivering video over the Internet (speed, cost, concurrency).
As Yahoo twists in the “corporate governance” wind (Kara Swisher has all the latest details at ATD), the company is falling apart. Yahoo is a sad story these days – it’s slipping away. People are leaving left and right. However the real problems are two fold: 1) the wrong people are leaving and 2) public brand perception is plummeting.
On the people side it’s not the executives leaving that a problem – hell half the execs need to go. The issue at hand is good ‘workers’ and “teams” of talent are leaving. Why? It’s easier to take a team out and start a new company or work for another company. All the stars are continuing to leave. A source from inside Yahoo recently told me that the only work getting done is powerpoint slides. In fact my source said “the way to survive and get promoted at Yahoo is to master the “powerpoint” presentation. “
On the user and marketplace side the fact is it’s not cool to use Yahoo anymore. I guess that Yahoo will own the market or franchise on the 60-something user market market – the people who have been locked into all Yahoo’s Web 1.0 stickiness tactics. Yahoo needs to do things differently.
I am a big fan of Yahoo and what it has meant to the progress of the Web, but it’s time to clean house. I mean really clean house. Get “mavericks” who can look beyond powerpoints and deliver product value.
Yahoo is slipping away.
Tags: HP, HP Labs, Intel, yahoo
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HP speed and execution has often been compared to an aircraft carrier, but not in this case. HP moves fast with the announcement of the gobal cloud research initiative. Last March I was predicting that HP Labs would move in this direction. Well they did and fast.
This shows me that HP can move fast on their promises and with some sizzle and steak. The partnerships of Intel and Yahoo show some real meat on the bone. I’m not expecting any massive products soon out of this initiative but certainly some innovation.
The test bed will initially consist of six “centers of excellence” at IDA facilities, the University of Illinois at Urbana-Champaign, the Steinbuch Centre for Computing of the Karlsruhe Institute of Technology, HP Labs, Intel Research and Yahoo!. Each location will host a cloud computing infrastructure, largely based on HP hardware and Intel processors, and will have 1,000 to 4,000 processor cores capable of supporting the data-intensive research associated with cloud computing. The test bed locations are expected to be fully operational and made accessible to researchers worldwide through a selection process later this year.
The test bed will leverage Yahoo!’s technical leadership in open source projects by running Apache Hadoop — an open source, distributed computing project of the Apache Software Foundation — and other open source, distributed computing software such as Pig, the parallel programming language developed by Yahoo! Research.
With this test bed, not only can researchers test applications at Internet scale, they will also have access to the underlying computing systems to advance understanding of how systems software and hardware function in a cloud environment.
Researchers at HP Labs, the central research arm of HP, will use the test bed to conduct advanced research in the areas of intelligent infrastructure and dynamic cloud services.
This has a kind of DARPA feel to it. I have many questions. How will it be organized? What will prevent it from becoming ‘vendorland’ of hidden agendas? How can I as an entrepreneur use it? What is the requirement to participate?
Final question: Where is Google and Microsoft on this?
Tags: Icahn, jerry yang, microsoft, yahoo
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Cofounder of Yahoo Jerry Yang can now get down to business. The Carl Icahn takeover saga is finally over. Icahn joins Yahoo’s board. I guess Carl has a lot of shares but his ‘lame duck’ board seat is a consolation prize for technologies version of “The Price is Right”. He lost. Last week we saw a final knock out blow to Icahn had him down for the count. Now we have peace.
“While I continue to believe that the sale of the whole company or the sale of its search business in the right transaction must be given full consideration, I share the view that Yahoo’s valuable collection of assets positions it well to continue expanding its online leadership and enhancing returns to stockholders,” Mr. Icahn said in the statement. “I believe this is a good outcome and that we will have a strong working relationship going forward.”
Finally Yahoo can get down to business and get the legal bull from Wall Street off their back. Expect a fast resolution to a Microsoft deal or other transaction (hmm AOL..). Yahoo has to move on now and get back to competing.
Tags: microsoft, Rumor, Search, yahoo
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Silicon Alley Insider has an interesting tidbit that confirms my story on June 19th that Microsoft was bunkered down in Palo Alto. It was that weekend that had Microsoft and Yahoo folks all over Palo Alto.
Henry Blodget writes on his blog today the details of what transpired on the weekend prior to June 19 as reported here on Furrier.org. Microsoft was in town to consummate the deal in Palo Alto as well as make a run at Facebook. It’s clear now they did make a run at Facebook but was rejected. Now Microsoft is trying to get support from the other players to stitch together a search plan. With Powerset now in the stable. Microsoft is moving to what looks like an orchestrated maneuver to get a search and online story fast.
He writes “Today’s Wall Street Journal, however, echoes reports that Yahoo left out at least one embarrassing detail from its “Microsoft timeline”–one that confirms that the excuse it used to reject the deal for months was nonsense:”
[On Saturday, May 17, in Palo Alto, Calif., two weeks after Microsoft walked], Yahoo CEO Jerry Yang, director Ron Burkle and chairman Mr. Bostock met with Microsoft’s Mr. Ballmer. Messrs. Bostock and Burkle told Mr. Ballmer they were prepared to sell Yahoo for $33 to $34 a share, the price range Microsoft had offered before talks broke down, according to people familiar with the meeting. That would have valued the deal at about $47 billion, or $6 billion less than Yahoo’s previous asking price of $37 a share
Microsoft was moving to get Yahoo search and had the messaging ready then was off to put the ‘checkbook’ in front of Facebook. They were pushed aside. Microsoft isn’t getting both of them but will mount a campaign to get equivalent “pieces” to compete against the ‘tide’ that is search 2.0 and social networks.
Yahoo ReOrging and On The Move – Strategy Hole? June 26, 2008Posted by John in Technology.
Tags: competitive strategy, yahoo, Yahoo Reorg
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Kara Swisher reported last night that Yahoo would announce the big reorg. Well she was correct. Yahoo announced the ReOrg today. Not much to say other than what is already being reported.
Here is the detail as of today (thanks Kara Swisher) .. the structure will pivot on several key execs, reporting to President Sue Decker.
EVP of Yahoo’s Platforms and Infrastructure division Ash Patel as head of a new Audience Products group (its name was changed from Global Products); Global Partner Solutions EVP Hilary Schneider as the head of a new U.S unit; various folks running around the rest of the globe.
There will also be another strategy team group with a new head, who has not yet been chosen.
And Yahoo will name Scott Dietzen (pictured, right) to take over the job of SVP Brad Garlinghouse, running all communications and community properties and products under Patel.
What All This Means?
To me the big area that is critical for Yahoo is corporate *and* competitive strategy. These variables are not mutually exclusive. Yahoo has some big weapons but under their current condition they have limited energy, time, and people resource (know-how) to execute. Therefore, it’s a chess game not a frontal brute force battle. Yahoo has to be smart and execute with precision. Every move needs to be calculated in context to their corporate and competitive plan. Yahoo has been winging it for years – relying on their massive pageviews and audience subscribers.
Yahoo needs to be “all in” and compete. I am in the camp of pro-Yahoo (always have been). I’m cheering for them to pour it on AND compete.
Tags: google, war, yahoo
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Today Yahoo sent a letter to their shareholders talking about the latest developments (wow what an understatment). I originally blogged that the Google deal was a ‘white knight’ deal for Yahoo. It forced Microsoft to run out on the deal. It was a godfather deal that allowed Yahoo to cover their ass against lawsuits (I’m sure they are coming).
My take: Yahoo will keep Jerry Yang and put a new team together. I’d love to fly that ship for a day. I think that Yahoo has some big guns it could bring out. They need guts and a maverick management team.
Dear Fellow Stockholders:
We are writing to update you on the latest developments here at Yahoo!, including our recently announced commercial agreement with Google and the outcome of our discussions with Microsoft regarding a potential transaction.
On June 12, we announced a non-exclusive agreement with Google that we expect will generate approximately $250 to $450 million in incremental operating cash flow for Yahoo! in the first twelve months following implementation. This cash flow will enhance our profitability as well as help support achievement of our key strategic objectives. Combined with continuing advances in our own search capability, the agreement is an important step in our efforts to capitalize on the high-growth online advertising opportunities where we are best positioned to compete successfully and create more value.
Let us explain why we find this new agreement so exciting.
The Yahoo!-Google Agreement is Financially Attractive and Strikes the Right Strategic Balance.
Under the agreement with Google, Yahoo! will continue to provide algorithmic and sponsored search results, but now will also have the ability to run sponsored search ads supplied by Google alongside Yahoo!’s search results. Advertisers will pay Google directly for each click on Google paid search results appearing on Yahoo!. Google will then pay us a fee (in industry jargon, traffic acquisition cost) based on revenue realized from click-throughs on ads supplied to Yahoo! by Google.
This carefully structured agreement strikes the right strategic balance, enhancing our financial results while advancing our strategic objectives of being the “starting point” for the most users on the Internet and offering such compelling value that advertisers will see us as the “must buy” in online advertising.
One of our key strategies for achieving these objectives is to capitalize on the increasing convergence of search and display advertising, where we are especially well positioned to compete and succeed. We have already accelerated our efforts to strengthen our presence in display through a variety of initiatives and acquisitions in recent months. Our new commercial agreement with Google enhances our ability to pursue this strategy.
Another key strategy is to open our platform to other developers to optimize monetization for our advertisers and publishers and provide the best experience for our users. We see this agreement as a natural extension of the efforts we have already made toward an open marketplace.
The Google agreement is non-exclusive and provides strategic and operational flexibility for Yahoo!. It allows Yahoo! to use Google’s services in those areas where Google monetizes our inventory more effectively but also permits us to continue to use our own search technology in areas where we believe we are most competitive. The net result is that the agreement helps us accelerate one of our strategic aims–closing the monetization gap. At the same time, it allows Yahoo! to continue to compete aggressively in search and display advertising.
Importantly, the agreement does not prevent Yahoo! from pursuing other alternatives that could increase stockholder value. Because the agreement can be terminated by either party upon a change in control, it would not preclude a transaction with Microsoft or any other potential acquiror in the future.
The Yahoo!-Google Agreement Does More for Stockholder Value than Microsoft’s Search-Only Hybrid Proposal.
We also want to update you on the conclusion to our discussions with Microsoft regarding a potential transaction. As we explained in our last letter, our board and management held numerous meetings and conversations with Microsoft about its proposal to acquire Yahoo!, both before and after Microsoft withdrew that proposal on May 3. On June 8, our Chairman, Roy Bostock, other independent board members, and members of Yahoo!’s management team again met in person with Microsoft representatives. At that meeting, Microsoft stated unequivocally that it has no interest in acquiring all of Yahoo!, even at the price range Microsoft had previously suggested.
Microsoft did propose an alternative transaction. Rather than acquire our whole company as it had been proposing for months, Microsoft now proposed to acquire only our search business for $1 billion and a share of future search advertising revenue. This proposal also included an $8 billion investment in Yahoo! but required Yahoo! to commit to a 10-year exclusive arrangement that would have made us dependent on Microsoft for all of our search business. It would also have given Microsoft veto rights on certain future Yahoo! actions, including a sale of Yahoo!. Our board of directors and management made a great effort–and conducted in depth negotiations–to elicit a feasible proposal from Microsoft that made strategic and financial sense for Yahoo!, but without success.
While Microsoft’s search-only hybrid proposal may have been helpful to Microsoft, our board and management concluded it would have had a significant adverse impact on Yahoo! strategically, leaving the Company without the operational control of search assets and technology we view as critical to our objective of becoming a leader in the converging search and display advertising business. The board and its advisers also carefully studied the financial impact of Microsoft’s proposal and concluded that it would have provided no meaningful improvement to our operating cash flow. In short, this proposal would have generated substantially less value for Yahoo! stockholders than Microsoft has suggested.
Based on all the key factors–strengthening our competitiveness, protecting our strategic position, generating attractive financial returns–the Google agreement is far better than Microsoft’s search-only hybrid proposal. That’s why we moved forward with it.
Your Current Board of Directors Has the Knowledge, Experience and Commitment to Best Represent Your Interests and Maximize Stockholder Value.
The events of recent weeks underscore the fact that your board of directors is far better qualified to represent your interests in the effort to maximize stockholder value than the slate put forward by Carl Icahn.
Based on Mr. Icahn’s narrow agenda, it seems highly unlikely that either he or his slate would bring added value to Yahoo!. Consider the following:
– Mr. Icahn put forward his slate so as to sell Yahoo! to Microsoft, even though he had no knowledge of the sustained efforts made by your current board and management to determine whether Microsoft was willing to engage in a transaction that would provide appropriate value and certainty of achieving that value. On June 8, Microsoft once again made it perfectly clear that it is not currently interested in acquiring Yahoo!.
— Mr. Icahn publicly opposed any alternative form of transaction with Microsoft. Your board and management, after thorough and deliberate negotiations and evaluation, separately concluded on its own that the alternative hybrid deal proposed by Microsoft was, indeed, not in the best interests of the Company or its stockholders.
— Mr. Icahn urged, as an alternative to a Microsoft transaction, that Yahoo! find a way to partner with Google that would not preclude a transaction with Microsoft in the future. We have done exactly that through the commercial agreement with Google we announced on June 12.
Simply put, you can choose to vote for a slate of nominees with no articulated plan for the future of Yahoo!–and who now have essentially no alternative agenda to offer you–or you can choose to vote for your existing board of directors which has the independence, experience, knowledge and commitment to navigate the Company through the rapidly-changing Internet environment, execute on our strategic objectives and deliver value for Yahoo! and its stockholders.
It is time for Yahoo! to turn its undivided attention to implementing its key strategies, and we therefore urge you to reject Mr. Icahn’s slate and his ill-defined agenda.
We strongly urge you to vote your WHITE Proxy Card today for your current board of directors.
We look forward to sharing our progress with you as we move forward and we thank you for your support.
Roy Bostock Jerry Yang
Chairman of the Board Chief Executive Officer
Tags: Mark Cuban, yahoo
Kara Swisher has a post on the short list of CEO candidates for Yahoo. She is assuming that Jerry won’t make it. I think that he’ll last even though everyone wants his head.
That being said Kara brings up a great candidate that isn’t a wildcard in my mind – Mark Cuban. I’ve had the chance to get to know Mark over the past few years – we even did a podcast together way back when. He has the attitude to move Yahoo fast in a good direction. Translation: he isn’t afraid to say what is needed to say, do what is needed to do, and recruit the right team to dominate a market.
Forget his enterpreneurship background and his aggressive in your face personality (which I don’t mind at all), he has done something pretty amazing lately. He bought and turned around a NBA franchise in the Dallas Mavericks – and he did it fast.
What relevance does that have? Well pro athletes have huge egos, get paid big bucks, and are high maintence – but their good (hence called pros). The business deals in big swings and big money. All of this sound like Yahoo?
Plus what sweetness it would be for Mark to come back to Yahoo after his stint there post broadcast.com.
Mark: The question for you is… would you take it?
Microsoft Has To Be Pissed – Google the White Knight June 13, 2008Posted by John in Technology.
Tags: google, Kara Swisher, microsoft, war, yahoo
Kara Swisher has a detailed report of the Microsoft offer to Yahoo. Microsoft has to be pissed.
What we have hear is a failure to communicate (name the movie). Yahoo did the ‘godfather’ deal with Google. Google is Yahoo’s white knight – period.
It’s a smokey back room deal that saves Yahoo from clutches of Wall Street and an escape from the frontal assault from Microsoft.
Microsoft’s only move? Burn the village and buy up the market. I expect Microsoft to go on a rampage and buy up everything that moves. They have to retreat and regroup.
Microsoft’s move: change the game. Google won this battle.
SAI has a great writeup on the details and implications on the Yahoo pass on Microsoft.
It’s the Silicon Valley poison pill.
Tags: facebook, microsoft, yahoo
My sources say that the Yahoo and Microsoft teams are bunkered down in a Palo Alto hotel hammering out the final stages of a transaction that will have Microsoft picking up the Yahoo search business. Word is that this deal will be done this week. While this is not surprising, it does bring to question the motives and plans of Microsoft.
Why would such a complicated transaction (just Yahoo search with all the headaches and all) be in the cards for Microsoft? After the failed bid for $40 plus billion for all of Yahoo, Microsoft’s intentions are clear. Buy the search business from Yahoo and take that team and go spend at least 20 billion for Facebook. Integrating the search team at Yahoo with Facebook puts a formidable army to take on Google.
What a move this makes. Yahoo gets everyone off their back, Microsoft gets a credible position in search, and buys Facebook to compete with Google. The price about $45 billion.
This is going to be good.
Update: here is a post from Kara Swisher - Microsoft’s Kevin Johnson’s “We Can Compete” memo - Microsoft needs Facebook and Facebook needs Microsoft.
Update 2: Robert Scoble (my former employee :-) ) is taking my report of Microsoft buying Facebook conversation to the next level. This will be developing further but in the meantime the jockeying is going on. This explains the recent moves at many levels… take the employees of Google leaving to join Facebook.. Facebooks posture toward Google, and the general platform behavior lately of Facebook. Maybe they knew that they were pulling a Netscape last week – knowing that Microsoft guns for hostages were coming into town.
Update 3: This is why I love this guy Umair.. Leading minds see the strategy…good post Umair.