OSNews

Not just these days, it's always been like that.
If you can't crush you're competition then buy them out.

I agree; it has always been like that, but not nearly as much so in the tech/Internet world.

I think buyouts are becoming more common in the digital world because PC and Internet industries are maturing. This is evident in the stagnation of software--for example, Word 2000 & 2003 are very much like, and Photoshop 7.0 is very much like CS3. A rapidly growing number of users are becoming hard-pressed to find reasons to upgrade, and companies are struggling to come up with shiny new stuff to entice us users to give them our money. These companies are confounded even more now that free, open-source software is starting to do most of the things that people need, for no cost. (Minus tech support, of course, though the computer-literate Joe User is starting to not care about that--there are forums and other resources on the web for help.)

Obviously, that has little to do with Yahoo as they are not a software company; however, it is evidence that the industry has matured, and Microsoft is a software company.

I think MS believes they've milked all they can out of their users with Windows and Office, so they are looking to further expand their scope. As of right now, their current attempts are not working--Windows Live Mail and Windows Live Search are failures compared to Google's offerings (or even Yahoo's), despite attempts to reference and integrate them into Windows. However, combine Yahoo and MS, and the two together could very well give Google some serious competition.

But, yeah, getting back to the point: the side effect of this maturity is buyouts. Buying out a tech company is no longer as risky because it's been proven that the industry is a viable source of income--despite the aforementioned stagnation, computers and the Internet are here to stay. Also, since the tech companies themselves have grown and matured, they now have the financial resources to do buyouts. These companies are buying one another out to quickly improve their products, expand their scope, and/or squash their competition because it is becoming increasingly difficult to do so.

As a tangent, speaking as (presently) a diehard Google user, I've noticed the quality of Google's results are slowly dropping, and the quality of Live's results are steadily increasing. I only use Live when Google fails me completely, and that's becoming a not common but notably more frequent occurence. When I do use it, I've noticed that the interface is getting slightly better, the results significantly so.

If Live continues to improve like this, and if Google continues this steady decline, then we might see two search engines instead of one on the market. But then again, who knows how Microsoft will use Yahoo!'s technologies? If they return to Yahoo's 'bad old days' when they were adding icons and such left and right and cluttering up the page with dozens of things that you weren't interested in which you still had to load anyways, then Microsoft's investment will just go to waste.

Of course they do. As Google put it best: it's "increasing the scale of innovation".

:P

"this is a big news."

It's not really that big...this isn't the first time rumors like these have surfaced about MS courting Yahoo. Seeing as Google just bought DoubleClick, this go round there is probably much more truth behind the talks.

Oligopoly aint the best form of market

Monopoly is worse.

Oligopoly aint the best form of market.

Some years ago, I would have agreed, but the more I learn about our bastardization of the free market, the more I have come to appreciate the effectiveness of two- and three-way battles in encouraging innovation and creating value for the consumer. Allowing a single entity to control a market is extremely unproductive, but allowing mature markets to consolidate into a duopoly ultimately seems to work in our favor.

We see this happen in even the most idealistic of markets, for instance in the free software ecosystem. How often do we see two projects rise to dominance and evolve in parallel despite unusually high levels of market flexibility and elasticity? A duopoly is the best compromise between competition and standardization--and collaboration in free software.

Often people claim that barriers to entry scale with market consolidation, but I don't buy into this notion, especially in markets that are already somewhat consolidated. If this proposed acquisition goes through, will it raise the barriers to entry in the search market? Maybe a little, but this was already an incredibly hard nut to crack. Ask.com has some pretty neat technology, but they've been unable to make any significant dent. Most people won't take advantage of these features until they are bought out by one of the search giants... and I guarantee that they will be acquired eventually.

Not to sound like I belong on stage at last night's debate, but we have to pay an implicit price for true freedom. If we want search technology to move forward, we need to tolerate the natural market forces that result in consolidation. Unless a new player brings radically better technology to the market like Google did years ago with their entrance into a much less mature search market, the path to progress inevitable goes through Google and Microsoft... and possibly Yahoo.

"internet portals?"

This isn't about portals (portals are so Web 1.0). It's about advertising revenues and search both of which are extremely lucrative. They are in the business of making money.

Edited 2007-05-04 16:20

Some people around here, and I am looking directly at you jayson.knight need to read what they write and take notice;

They are in the business of making money.

That is what Microsoft is about. It is not about a better user experience, it is not about making the products the best products for you, it is just about making a product that will sell.

They have no loyalty to you, why do you have it for them ?

"They have no loyalty to you, why do you have it for them ?"

They are passionate about their developers. Period. I am absolutely positive that if I was a sysadmin using MS products, or a general knowledge worker using MS products, I would have found a new career long ago. Their developer products make my life easier, which in turn makes my clients live's easier.

When I said in the business of making money, that's a general statement. There isn't a company on the planet who isn't in the business of making money...no matter what their product, they have to show their investors ROI otherwise they will tank. The business of making money is not MS's only business. Don't fall into the trap of taking everything you read at 100% face value.

There is already a Vista soft drink: http://seattlepi.nwsource.com/business/279428_theinsider31.html =]

"What's next? Microsoft cars? Microsoft brooms? Microsoft tomatoes? Does the world need more mediocre products?"

LMAO!

Up next, Microsoft condoms, followed immediately by the next baby boom!

Up next, Microsoft condoms, followed immediately by the next baby boom!

The new company slogan could be

"Who do you want to f**k today?"

AHAHAHAHAHAHAHAHAHAHAHAH!!! :-D

"The new company slogan could be

"Who do you want to f**k today?""


Every story gets a ridiculous post like this.

Edited 2007-05-04 19:00

It's a lot funnier than your usual tripe. (I don't know why I'm feeding the troll... sorry to everyone else).

GE. Sheesh, they make light bulbs - do they really need to make washers and dryers and jet engines and give bank loans?

Seriously though, think of General Electric. They started off simply as a lighting company making light bulbs. Over time they have evolved and grown into a giant conglomerate.

From GE: "From jet engines to power generation, financial services to plastics, and medical imaging to news and information ..."
GE Commercial Finance
GE Healthcare
GE Industrial
GE Infrastructure
GE Money
NBC Universal
Each of which has several companies and business units of their own.

Microsoft is currently trying to dominate the computer market in all aspects. Much as GE started off making light bulbs, Microsoft began with a BASIC interpreter for the Altair. They now make arguably the worlds most widely used operating system and the most widely used office application suite. Then comes the XBox, enter the console entertainment industry. The keyboard and mice are an attempt to enhance they way you use their products.

More effort will be spent for many many years directly in the computer electronics market, but eventually I see Microsoft branching out into completely unrelated areas of technology and business. Why? Because they can, and they're good at it.

the problem is that they have to grow to keep those stupid shareholders happy
ms is #1 when it comes to office software and operatingsystems. the only way for them to grow is to enter new markets. and thats what the did and do

It is simple. They have money to spend. They have to invest it somewhere. I am not an expert on US tax law, but if someone just sits on the money there is more tax to pay, I think.

There is even more diversity in Japanese corporations like Yamaha, Kawasaki, Suzuki.... It is safer, if one sector is performing bad, the others will keep company afloat.

hat's next? Microsoft cars? Microsoft brooms? Microsoft tomatoes? Does the world need more mediocre products?

I once read that the MS will only create a product that doesn't suck once it decides to enter the vacuum cleaner market...

"I once read that the MS will only create a product that doesn't suck once it decides to enter the vacuum cleaner market..."

I can just see their ad slogan:

Buy MS Vacuum Cleaners, 'cause we know a lot about sucking!

@pandronic
I really don't understand why Microsoft has to compete with everyone in the industry ... I mean - they make OSs and office applications - do they need to make mice, consoles, security software, internet portals? It's ridiculous.

What's next? Microsoft cars? Microsoft brooms? Microsoft tomatoes? Does the world need more mediocre products?

Couldn't have said it better myself.

Yeah, might be time to think about moving all my email to GMail from Yahoo mail.

yep, Microsoft are not buying yahoo per se, they're buying the user base yahoo got.

however, if they do buy yahoo, many of yahoo users will leave yahoo to google.

however, if they do buy yahoo, many of yahoo users will leave yahoo to google.

How many (percent) do you think is going to leave ? And why ? Beacause the don't like Microsoft and care who owns the site ? Or because of the quality of service ?

A number people who will leave Yahoo because of the fact that it belongs to Microsoft is probably as big as a number of people who will abandon Windows because it is a product of Microsoft.

I am not advocating Microsoft here, just trying to keep in touch with reality.

How many (percent) do you think is going to leave ? And why ? Beacause the don't like Microsoft and care who owns the site ? Or because of the quality of service ?

A number people who will leave Yahoo because of the fact that it belongs to Microsoft is probably as big as a number of people who will abandon Windows because it is a product of Microsoft.

I am not advocating Microsoft here, just trying to keep in touch with reality.

Clue stick: I'm probably one of Microsoft's greatest detractors on this site, but I didn't leave Microsoft technology because it was from Microsoft; I learnt to loathe Microsoft technology because it sucks.

I don't like their products, too. I think that they are very good in pure business aspect of their job. They have perfect sense how far can they push consumers and still keep them loyal. Always on the edge.....

Do you think that they would lower the quality of Yahoo,
if they get it ? In terms of performance, search ability, user interface, web mail, or portal content ?

I agree, in part, counter examples are:

SQL Server
Virtual PC (took away mac compatibility)
Bungi (same as above)

SQL Server is the big one here, say what you will about it, it's very popular and easy to use.

sql2000, yes. sql2005 is a totally different story. The new front is a lot worse than the 2000 version and buggy as hell. There are almost no server side improvements. Try to do paging with the new row_number feature and compare it to for example postgresql's limit and offset. SQL server is a solid product, it was good from day one. Microsoft is just not improving it.

Just because it takes longer does not mean they aren't running it into the ground

I disagree, I use both 2005 and 2000 and I really like 2005, it's easy to use, and integrates nicely with Visual Studio.

SQL server is good for end user. It is fast and reliable. It does not require tunning because it is already tunned for Windows only.

It is not as good for developers and admins. I have found many good features from Postgres missing.

There is no database dump, just binary backup. No LIMIT and OFFSET in SELECT. CREATE VIEW has to be executed in separate batch, can't be combined with other commands. No standard SQL timestamp. Constraints are not dropped when table is dropped, they must be dropped explicitly, before the table is dropped.

All in all, I, as a developer, don't like to work with it.

I use it as a developer, and it the way it integrates with visual studio is wicked, I prefer to work with it or mySQL, I find that every app has it's tradeoff.

I don't use Visual Studio, but I thought that there should be some kind of integration, because the tools that come with SQL server itself are not much.

Yes, I forgot, iSql terminal application has strange habbit to make all fields NOT NULL by default, when CREATE TABLE command is executed. I find it strange.

Don't forget Rav Antivirus

and visio

Well, I've also read speculations about Sun buying AMD, and AMD bought Ati, so combine all that with Google buying Sun, this is too much, I can't compute

Ah you beat me to it.

I wonder if they'll pull a hotmail and eventually phase out all of the linux/bsd servers that yahoo uses. From what I understand there are far more BSD servers over at the yahoo camp.

I use FreeBSD and I would hate to see this happen. But a more personal note, I would hate to see Yahoo run by Microsoft. I friggin hate Microsoft! They're just a huge technology stifling monopoly!

And the both of you beat me to it. I was already typing a new comment about it, but I scrolled up to reference the article and saw this comment. I need to RTFC.

I wonder if they'll pull a hotmail and eventually phase out all of the linux/bsd servers that yahoo uses. From what I understand there are far more BSD servers over at the yahoo camp.

I'm fairly sure they will, though it would be rather interesting--and perhaps much easier from a technical standpoint--if they migrated to Novell SUSE or something.

I wonder if they will migrate all of the Yahoo! Mail users to Hotmail/Windows Live Mail/whatever it is these days. I believe that they will either incorporate the Windows Live Mail backend to Yahoo! Mail or use Yahoo! Mail's backend on Windows Live Mail. Or build an hybrid of the two.

Despite being long-time SUSE user and evangelist (though my love of SUSE has decreased significantly since the horrendously buggy 10.1 & 10.2 releases), I'm also a big fan of the BSDs, particularly FreeBSD. (I think SUSE sitting on top of a FreeBSD kernel would be pretty cool.) It would sadden me if they changed server operating systems, be it to Microsoft, Novell, or anybody else.

*giggles*

Microsoft and Yahoo! have always competed in two very different arenas. The only one in which they have significant competition is search, and what role could antitrust legislation possibly play? Preventing MS/Yahoo from having the second best search engine after Google?

IANAL, so I'm probably spewing bullshit, but I kind of see how antitrust laws could prevent Microsoft from buying Yahoo, given their past behavior and lawsuits.

Regardless, if that's not the case, I believe preventing buyouts based on past anticompetitive behavior would be a good idea, although it would have to be within reason (ie: behavior in the recent past, perhaps a decade or something).

"and then look at Yahoo!'s smorgasbord of social networking options (namely Yahoo! Instant Messenger, and Yahoo! Groups, which is still the best groups service outside of actual usenet)"

Fantastic point, and don't forget that Yahoo owns del.icio.us and flickr as well. People seem to thing this is about search, and it's not...it's mainly about social sites + advertising. Search is saturated, social sites are not.

"50B USD is not a drop in the bucket for Microsoft"

It would be a stock deal. Still not a drop in the bucket, but MS has a stock market cap of close to $300BN, Y! is around $150BN.

"If they are going to put that much equity into Yahoo!, then they probably feel very strongly about the business future of social networking"

If you were inside the walls of Microsoft right now, you'd know just how true that actually is.

It would be a mixed stock and cash transaction.

Microsoft's stock is stuck at the proverbial $25 - $30 range.

It's been split too many times. They ROI for the many shareholders of Yahoo outside of a dividend is weak for a stock upswing.

The social side of things is where I figure the desire from MS is also. I think one of the things that large corporations are incapable of at an almost genetic level is building good / desirable social software. Even some of Y!'s better examples are purchases, like flickr.

It would be interesting to see if MS would actually be able to maintain whatever communities they end up buying or if there natural desire to 'leverage' them would end up breaking them up. Unless they can actually hold these things together (more accurately: stay enough out of the way and let them hold themselves together) then a purchase like Y! is a great way to waste $50bn

It seems I was given credit for this article, when it wasn't one of the ones I submitted today. Huh; that's not right...

The submission system doesn't lie . Unless somebody else than yourself was logged in using your account, there is no other possibility for this submission being linked to your user_id.

A month without Google?! its like asking what if there were no Chuck Norris.

Actually, a Google-free Internet wouldn't bother me too much. (Neither would a Chuck-Norris-free Internet. ) The only Google service I'm addicted to is Gmail; I'm not willing to give up my precious Gmail account. (For no other reason than too many contacts and clients have my address for me to easily and conveniently change it. I access my mail using Thunderbird, so Gmail's web interface is useless to me. Gmail is about the same as, say, Lavabit [http://lavabit.com] or someone else that offers free POP3 access.)

The "big three" search engines are about the same. Their results are often very similar, but they still complement each other nicely at times. I use all three, but my current favorite (and default) is Windows Live Search. Windows Live Search has better aesthetics, and its text advertising lot less intrusive due to using a subdued grey background instead of brighter colors. Also, the results seem to be less "tainted" with useless keyword climbers, and its related searches list is usually more relevant than Google's. But its image searching isn't on par with Google, and Google Groups pretty much has no competition.

I haven't used Live search in a long time, but I thought images was its big strength. The infinite scroll thing seemed to work quite nicely there and the UI of splitting the results with the webpage chosen seemd to work pretty well so that you could keep searching if the first one did not appeal to you.

What's changed? Has google gotten better, or is this a results thing rather than a UI issue?

And does anyone else find it notable that "Live" backwards is "eviL"?

Edited 2007-05-04 20:07

It's more of a results thing. Maybe it's just me, but it seems Google's image index seems a lot bigger than Windows Live's.

But the infinite scroll does actually bug me for some reason. Maybe I'm just resistant to change or something. I do love the thumbnail resizing, the scratchpad, and the way they present the results, however.

I've tried switching before when I had trouble finding really obscure things on Google. Wasn't ever impressed, though. I usually just found less of the same wrong results.

Edited 2007-05-04 19:19