From Dealbreaker's Opening Bell
Microsoft: Should They Buy Yahoo? (Tech Trader Daily)
This is a discussion that seems to pop up every 4-6 months. There's some belief that if Microsoft were to buy Yahoo, the combined entity could be a credible challenger to Google. Yes, Microsoft needs some help in the area of the internet, and yes Yahoo is still a big company with a lot of users. But it's unclear how a combined Microsoft+Yahoo would perform any better than Microsoft and Yahoo not combined. Both are losing out to Google, and nothing about the combination would seem to offer any real trick to get things turned around.
The fact is, the buzzword "synergy" went out of fashion around 1997, because it doesn't really happen. You can't tie two pigeons together, and create an eagle. You just end up with a pair of ruffled, angy pigeons who can only flap one wing each, and don't want to be tied together*
Really, what core competency in either Microsoft or Yahoo's bag-of-tricks would shore up the shortcomings of the other? Both have hidebound, monolithic corporate structures. Both promote an image of themselves as cutting-edge while continuing to repackage the same old concepts. And both think that jamming more features and content into the box counts as innovation.
I don't see it happening, and I'm not the only one.
*in retrospect, I wish I had come up with this analogy when talking about a putative GM and Chrysler merger last week.
Friday, March 02, 2007
Who keeps suggesting that Microsoft should buy Yahoo?
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1 comment:
Indeed, the pursuit of synergy in the 80s and 90s made a lot of money for the firms which facilitated the process of making a few businesses really, really large. Now those same firms are making a lot of money facilitating the process of divesting those large businesses of the accretions which are not part of their "core competency." Some trends can be rather expensive.
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