Software maker Microsoft asked search engine operator Yahoo to re-enter formal negotiations for an acquisition that could be worth USD 50 billion, the New York Post reported on Friday. Microsoft is feeling increasing pressure to compete with Google, which plans to beef up its portfolio with a USD 3.1 billion buy of online advertising company DoubleClick. Earlier this week, Yahoo said it would buy 80 percent of advertising exchange Right Media for USD 680 million, increasing its stake in that company to full control. Microsoft currently trails both Yahoo and Google in the lucrative and growing business of Web search. Update:. The deal's off.
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Member since:2007-03-26
Member since:2007-02-22
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.
Member since:2005-06-29
Member since:
2007-03-24
Everybody buys out everybody these days.