So Microsoft and Yahoo! are in takeover/merger talks. It’s getting major coverage. Is this a good idea?
- Bill’s Hard Drive
- Microsoft trying to buy Yahoo
- MSFT to YHOO?
- Microsoft aggressively courting Yahoo (again)?
Buying Yahoo! would be Microsoft’s dumbest move ever. Focus dilution, merge headaches, corporate culture clashes … the list goes on and one. Frankly, if I was Google or any other Microsoft competitor, I would be praying that they do buy Yahoo!
Microsoft’s niche – OK, ecosystem – is not the web. That’s not what they do best. They’re desktop and server. That’s where they win. It’s not clear to me that buying Yahoo! makes them any more web-native.
Microsoft would effectively be granting competitors a 6-month headstart – at least – while they tie themselves and Yahoo! up in interminable negotiations, strategizing, and what/who stays/goes triage.
Finally, Microsoft’s ace in the hole – one of them, anyways – is their massive cash hoard. That loot buys them 5-6 mulligans in just about any business sector they’re in. If they use up all or a significant part of their cash, they become that much more vulnerable to the consequences of screwing up.
And screwing up is easy to do when you take your eye off your ball.