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Links for May 13, 2008

HTC Unveils Beautiful Touch Diamond Phone
HTC announced the latest phone in its growing high quality Touch series, the Touch Diamond, which comes with a pretty piano black finish, some cool new interface elements on top of Windows Mobile, like “lets users sort and view e-mail like stacks of letters, receive animated weather forecast graphics, and look at pictures as though they’re in a roll of film”, as well as a 3.2 megapixel camera, GPS and HSDPA.

Live Messenger Facebook Application
Microsoft has released an official Facebook application that lets you access Windows Live Messenger and chat with your Live IM contacts on Facebook. Visitors to your Facebook profile can send you IMs right from the page.

MS’s Greg Linden on News Personalization
I always find what Greg Linden has to say interesting, but now that he works on god-knows-what at Live Labs at Microsoft, it takes on even more importance. Read his paper on personalizing and customizing the news.

New Zune Probably Won’t Block Downloaded TV Shows
There was a rumor going around that Microsoft was planning on an agreement with NBC that would put NBC’s shows on the Zune in return for a form of active DRM that actually blocked non-copyprotected downloaded copies of NBC shows from being loaded and watched on a Zune. It was a pretty horrible idea, and Microsoft is making it very clear that they had no such plans.

Microsoft Donates $1.3 Million From i’M Initiative
Live Messenger program does a lot of good, donating some serious cash. Hotmail users can now join the party with small ads in their email signatures that pay out to charity.

Microsoft Discontinues SPOT Watches
Microsoft’s technology push to get smart watches with MSN Direct updates delivered by radio frequencies has ended, with MS discontinuing the product due to it never catching on with consumers. I always wanted one, though the large size and limited selection whenever I shopped for them kept me putting it off.

Grand Theft Auto IV Breaks Sales Records
GTA IV broke Halo 3’s sales record, selling 3.6 million units on day one, totaling $310 million in revenue in a single day (compared to Halo’s $300 million). That of course, is double what the highest opening weekendrecord for the film industry is. First week sales were $500 million.

Zune Video Store Starts Rolling Out
Microsoft started delivering a video store for Zune owners, releasing a version 2.5 Zune store update that allows users to download TV shows for now, and later movies.

Shareholders Making Yahoo Pay For Fighting Microsoft
Yahoo’s shareholders are not happy with Jerry Yang for spurning Microsoft, and they’re voicing that dissapointment. Seven analysts downgraded the stock to “sell” or “strong sell”. The stock fell 20% the day after Microsoft dropped the bid, but it isn’t below the point it was at before Microsoft made offer.

Messenger TV On The Way
Windows Live Messenger TV is coming, and you can see screenshots and read about it at LiveSide.

May 13th, 2008 Posted by Nathan Weinberg | Zune, Windows Mobile, Live, Halo, Halo 3, Grand Theft Auto, Yahoo Acquisition, Windows Media, Corporate, Yahoo, Windows, Xbox, Messenger, Xbox 360, Hotmail, MSN | no comments



Microsoft Drops Plans To Buy Yahoo

Microsoft announced tonight it will not be going forward with its plan to buy Yahoo, after it was clear the two sides could not agree on a price, and Steve Ballmer elected not to risk his entire career on the deal.

Here are some links about the news:

Here’s Microsoft’s press release announcing the decision. It’s clear that Microsoft raised its offer to $33 (effectively adding $4 to the deal, based on stock value, or $5 billion, and Yahoo wanted another $4, a total of $10 billion over the original offer, which Microsoft believed was unworkable.

Here’s Yahoo’s press release in response. They don’t seem at all dissapointed.

Here’s Steve Ballmer’s letter to Microsoft employees.

Now with the deal off, it looks like Yahoo could announce a deal to give its ad business to Google as early as this week. Perhaps Microsoft plans to let Google get Yahoo, and thus almost the entire market, then try to bury their big competitor under an avalanche of antitrust complaints.

I’ve never seen Techmeme so dominated by one story.

Valleywag is saying this could be the end for Steve Ballmer. God, I hope not.

Expect Yahoo’s stock price to drop like a stone, considering how it was propped up by Microsoft’s offer.

May 4th, 2008 Posted by Nathan Weinberg | Yahoo Acquisition, Corporate, Yahoo | 2 comments

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News For April 6, 2008

Microsoft Sends “Put Up or Shut Up” Message To Yahoo
Microsoft is sick of Yahoo dragging its feet on MS’s proposed acquisition of the internet company, and has published a stern letter from CEO Steve Ballmer to Yahoo’s board. The letter basically says that Yahoo has had plenty of time to make a decision, and Microsoft wants them to either make a deal or face a hostile takeover. Considering the dragging its feet caused Yahoo to be in this weak position, it should surprise no one that they can’t even lose gracefully.

Data Corruption Bug Fixed in Next Home Server Update
The Home Server blog has announced that they have come up with a fix for the data corruption bug that has plagued Home Server users in certain circumstances. Since they are working on Power Pack 1 for Home Server, due for public beta testing next month, they are including the fix with the Power Pack in order to ensure everyone gets it.

Open XML Becomes International Standard
The members of the ISO voted 75% to 14% to approve Microsoft Office 2007’s Open XML file formats as an international standard, removing the barrier erected when the IBM-backed ODF format did the same thing two years ago. The two file formats are now on a level playing field, ensuring that government agencies will choose the better (and more cost-effective) office suite, not the one with ISO certification. ISO controls Open XML now, not Microsoft, and can change any part of the spec, with Microsoft forced to change Office to comply.

Another 11-Cent Dividend Coming To Microsoft Shareholders
Microsoft has announced yet another dividend for shareholders, another 11 cents for those invested in the company. Shareholders as of May 15, 2008 will get their dividend on June 12. This will make $4.72 returned to shareholders over the last five years, just over 16% of the stock price.

Silverlight-powered MLB Site Has Disastrous First Week
Baseball season started last week, and the launch of Major League Baseball’s new Silverlight-powered MLB.tv site, where you can pay to watch live games on your computer, had a terrible opening day. With fans paying $20 a month or $120 a year to watch games only on their computer (almost as much as you’d pay to watch a higher quality version on cable or satellite), they were understandably peeved at not getting what they paid for. Now word on whether the problems were on Microsoft’s side or MLB’s, but having such a high-profile launch go bad isn’t a good thing for Microsoft’s important Silverlight technology.

April 6th, 2008 Posted by Nathan Weinberg | Server, Home Server, Silverlight, Yahoo Acquisition, Developers, Corporate, Windows, Open Source, Yahoo, Office, Applications | one comment

News For March 23, 2008

Microsoft Produces Limited Edition GTA IV Xbox 360
Microsoft has released a very limited stock of Grand Theft Auto IV Xbox 360 Elite consoles, 500 to be exact, complete with a GTA IV design on the side panel and a briefcase full of peripherals. The consoles are individually numbered, so you know how limited of an edition it is, and the briefcase has wireless controller, ChatPad, headset, camera, remote, and charge kit.

Vista Service Pack 1 Released
Microsoft has finalized the release of Windows Vista Service Pack 1, putting the major update to Vista in the hands of users. Some users are getting it pushed to them via Windows Update, and if you don’t have it yet, just go here to download the standalone 434 megabyte installer for 32-bit versions of Vista. This link will get you the 64-bit version.

If you aren’t getting Vista SP1 through Automatic Updates, and are not even getting it offered as an option, it is likely because your computer is failing a number of prerequisites. One of them is driver compatibility, and since Sigmatel audio drivers aren’t worth crap on Vista, practically anyone with one of those chips in their systems won’t get SP1 without installing it manually. Read more here.

Microsoft Launches AdCenter Community
Microsoft has launched AdCenterCommunity.com, a website for its growing AdCenter advertiser base to to learn about ways to run better ad campaigns, with niche-specific blogs, user forums, and other community features. The community offers advice on the AdCenter API, Analytics, and represents an effort by Microsoft to distinguish itself from Google AdWords, which has notoriously poor communication with with its advertisers.

Mac Office 2008 Gets Updated
Microsoft released a patch for Office 2008, fixing problems that could cause Office programs to crash or otherwise stop responding. It also improves security, keeps restricted users from having unauthorized access to Office program files, fixes a blank page printing problem, fixes font substitution issues, adds support for secondary displays, and many other fixes and improvements.

Microsoft’s List of Potential Yahoo Board Members
If Microsoft winds up completing its effort to buy Yahoo through a hostile takeover, they’ll need to nominate a full new board of directors. A part of that list has leaked out, naming four of the ten executives Microsoft may place on the board. They are:

  • Edward H. Meyer - former CEO, Grey Advertising
  • John Chapple - CEO, Nextel Partners
  • Tom Freston - former President, Viacom
  • Jaynie Studenmund - Former CEO of eHarmony

Yahoo is reportedly finally holding talks with Microsoft, having a meeting to let Microsoft explain its offer and put some of its vision forward. Even if Yahoo doesn’t want to give in and except Microsoft’s offer, the offer may be impossible to ignore, especially if Microsoft raises the amount it is willing to pay. With other potential buyers dropping out, it’s certainly something they should consider.

Virtual Earth Implemented in Flash
Like Windows Live Maps? Like the compatibility and ease of Flash applications? Then you’ll like that AFC Components has added the Virtual Earth API to its UMAP control. You can see Virtual Earth embedded right here:


Read more about it here. Via Digg

Sony PS3 for $100 Off
If you are looking to go with a Sony PlayStation 3, you might be glad to know that the SonyStyle store is offering $100 off the purchase of a 40gb PS3 with a new Sony card, making it just $300. That’s a good enough deal even if you find Sony as evil as many do, just to get a good Blu-Ray player and a small number of decent exclusive games.

March 23rd, 2008 Posted by Nathan Weinberg | Maps, Live, Virtual Earth, Advertising, AdCenter, Grand Theft Auto, Yahoo Acquisition, Vista, Corporate, Yahoo, Windows, Xbox, Office, Apple, Xbox 360, Applications | no comments

Microsoft May Keep Yahoo’s Sunnyvale Campus

Microsoft is saying that, assuming it wins in its bid to buy Yahoo, it will not completely uproot Yahoo from its large Sunnyvale campus. Rather, Microsoft recognizes the value Yahoo has (albeit diminished recently) as a large force in the Valley, plus Microsoft doesn’t want many valuable Yahoo employees to leave rather than relocate. Expect Sunnyvale to become Microsoft’s second most important campus in short order, and don’t be surprised if a few Windows Live teams are asked to relocate there.

February 26th, 2008 Posted by Nathan Weinberg | Yahoo Acquisition, Yahoo | no comments

Yahoo Shareholders Sue Company For Running From Microsoft

A lot of Yahoo shareholders are angry at the company for trying to weasel out of Microsoft’s offer to buy them out for tens of billions of dollars, and have filed a lawsuit against the board of directors. The suit claims the board is breaching its duties to get the most value for investors, and that the company is pursuing “value-destructive” deals with other companies, like Google, AOL, and News Corp., that are being described by many as “poison pills”.

The lawsuit was filed in Delaware Chancery Court on Thursday by lawyers representing Detroit’s police and fire retirement system and general retirement system, as well as “all other similarly situated public shareholders.”

February 24th, 2008 Posted by Nathan Weinberg | Yahoo Acquisition, Yahoo | no comments



Yang Loses Control Of The Yahoo Board

The New York Post is reporting that a mutiny is underway in Yahoo’s boardroom, with concerned Chairman Roy Bostock turning on CEO Jerry Yang’s resistance to Microsoft’s proposed takeover. If Yang successfully weasels out of Microsoft’s grasp, some of the board is worried that shareholders will sue, especially if Yahoo’s moves are motivated more by some emotional need to keep Yahoo independent than the more important financial need to keep Yahoo from going dead broke.

According to one source close to the situation, “The emotional part of Yang would rather do anything but sell to Microsoft, but he doesn’t have the cards to come up with a value-creating, competitive alternative for shareholders.”

“While Yahoo!’s board has a fiduciary duty to maximize shareholder returns, running the risk of derailing a deal is dangerous to Yahoo! shareholders,” said Jefferies analyst Youssef Squali.

For now, Bostock and other board members, such as billionaire Ron Burkle, are leading the fight to force Yahoo’s old guard to do whatever is necessary to ensure the company has a healthy future. Opposing them are Eric Hippeau from Softbank and Robert Kotick, the CEO of Activision.
(via Valleywag)

February 17th, 2008 Posted by Nathan Weinberg | Yahoo Acquisition, Corporate, Yahoo | one comment

Yahoo Trying Google, News Corp. Escape Routes

Yahoo’s board is trying any port in a storm to find a way out of getting bought by Microsoft, looking to partnership deals with Google and News Corporation. Yahoo’s attempt to outsource its search business to Google in return for the financial stability to hold off Microsoft appears to have failed, with Google backing out to avoid mounting antitrust concerns, but an eight-month old News Corp deal is moving again.

Under the old deal, News Corp would deal MySpace and IGN to Yahoo in exchange for 30% of the company’s stock (stock created by a secondary public offering), valuing MySpace/IGN at $12.3 billion and the new Yahoo at $49 billion. The new deal would likely offer News Corp 19.9% of Yahoo, or $10-11 billion, with the 19.9% number chosen for some really scummy reasons: Any deal under 20% of the company doesn’t need to be approved by shareholders.

While the job of a company’s board is supposed to be to create shareholder value, Yahoo’s ruling class has made it clear that they want to save the current incarnation of the company, whether or not that is good for investors. This proposal would deal away almost a fifth of the company, specifically designed to sneak in beneath rules designed to protect shareholders.

If Yahoo’s board wants to make it clear to investors that it doesn’t have their best interests in mind, this deal would do it. If Microsoft pushes ahead for a hostile takeover, Yahoo shareholders are going to have some really good reasons to side with the Redmond giant.

According to Valleywag, the MySpace deal is being held up by disagreement of the value of MySpace, which makes sense. If MySpace was worth $12.3 billion eight months ago, when Yahoo was less desperate, would it really be worth $2 billion less now, when Yahoo’s board wants it more than anything?

February 14th, 2008 Posted by Nathan Weinberg | Yahoo Acquisition, Corporate, Yahoo, Google | no comments

Wall Street Not Happy As Yahoo Tries To Dodge Microsoft Bullet

Yahoo is rumored to be looking for alternatives to stay out of Microsoft’s clutches, and Wall Street is not happy. The rumors say that Yahoo has started up merger talks with Time Warner’s AOL unit, or rather restarted them, desperate for anything that doesn’t involve selling the company for an amount Yahoo says seriously undervalues the company. Yahoo may be playing Microsoft for more money, either out of a desire to profit or so Jerry Yang can go out with some pride.

A source close to Yahoo!’s thinking told The Times: “All they [Microsoft] are trying to do is pick off the company on the cheap. They’re trying to steal it. And the board is not going to let that happen. They have gone for a valuation that reflects the five-year low of the stock.”

The source added: “It would have to be in the 40s to start talking, and we would have to get over regulatory issues. It would have to be an offer that would give Jerry Yang something to stand on a podium and smile about.”

Valleywag jokingly reminds us that AOL lazily ripped off Yahoo’s home page months ago, so Yahoo wouldn’t even need to worry about integration.

Wall Street is already getting mad at Yahoo’s delay tactics and posturing. Investors in Yahoo are saying they are sick of losing their money, and are looking to cash out with the Microsoft offer, whether or not it is actually good for the company. That’s bad news for Yahoo, because it means that regardless of what it does, investors are likely to get pissed off and turn on the company, that is unless Yang can pull a brilliant rabbit out of his purple hat. If Microsoft does go hostile, early indications are Steve Ballmer will find all the votes he needs to takeover the Yahoo board.

February 12th, 2008 Posted by Nathan Weinberg | AOL, Yahoo Acquisition, Corporate, Yahoo | no comments

Live Search Market Share Holds Steady As Yahoo Implodes

Compete’s latest search engine market share numbers are out, and, as usual, Google is a winner, Microsoft’s Live Search, Ask and AOL hold steady, and Yahoo is bleeding out. Yahoo’s market share fell another third of a percentage point, now down six full points, or over 25%, in the last year. Google went up over half a point, pulling almost seven percent higher on the year.

Most interesting are the marks for search volume. The number of searches on all the major search engines are way, way up from last year; all, except Yahoo:

Percentage gain
Google 51%
Ask.com 49.4%
AOL 46.7%
Live Search 32.7%
Yahoo 0.3%

Yeah, Yahoo doesn’t need anybody’s help.

February 11th, 2008 Posted by Nathan Weinberg | Live, Yahoo Acquisition, Yahoo, AskJeeves, Windows, Google, Search | 2 comments

Yahoo Tries To Reject Microsoft’s Buyout Offer

Yahoo’s board voted to reject Microsoft’s $44.6 billion offer to buy the company. The board rejected the offer, saying it “massively undervalues” Yahoo, and thinks that Yahoo’s investments in Panama will eventually pay off and remove the need for the company to be bailed out, at least at that price. Most believe that the company will agree to a sales at $40 a share, $12 billion higher than the original $31 offer.

The problem for Yahoo is that investors want Microsoft to buy the company, and if the Yahoo board manages to screw this one up, the market will make them suffer. There are only a few possible scenarios left for the embattled internet company:

  • Microsoft increases its offer to match the $40 level. That would require $56 billion, half cash, half stock. Microsoft was already going to borrow about $10 billion, now it’ll have to pick up $15-18 billion in cash, plus give up an additional $6 billion in stock. It’s a lot of extra money, and Microsoft may balk. Luckily, there’s always option two:
  • Bargain the price down. Microsoft wants $31, Yahoo wants $40? You don’t have to be King Solomon to think up $45.5 per share. That’s mean an even $50 billion, and extra $3 billion in cash to borrow and $3 billion in Microsoft stock to give to Yahoo shareholders. Perhaps a little more manageable.
  • Or, Microsoft could go hostile, and bring the $31 offer to Yahoo’s shareholders. The shareholders are freaked at the idea of Microsoft quitting on them, since they bid up the share price and stand to lose a lot as the stock tanks after a withdrawn offer. A hostile takeover bid would put Microsoft in charge of the terms, getting the price it wants and kicking Yahoo’s board to the curb. The company stockholder meeting, later this Spring, will be the site of a showdown.
  • Finally, Microsoft could quit. The stock price will fall at least ten, possibly fifteen dollars. Heads will roll on the board as shareholders demand someone pay the price. The turmoil of the event rocks the company and sends even more employees for the hills. And, just as things seem at their worst, Microsoft offers to buy the company… for $27 a share.

Some other things to note: Microsoft’s offer to buy Yahoo has sent its own stock price down four and half dollars since the offer was made, costing the company over $40 billion off it’s own market cap. That means, until the stock recovers, Microsoft will have lost something like $80 billion, plus.

One other problem: Since Microsoft’s offer is half for cash, half for stock in Microsoft, that means that as Microsoft’s shares decline, so does the offer. With the stock portion now down the $26.64 per Yahoo share, the full offer is $28.82 per share, making it worth $41.46 billion, down over three billion dollars. If the price decreases further, Microsoft will either save money, or have to increase it’s offer either way.

You can use the MSFT-YHOO bid calculator to determine the difference between Microsoft’s original offer and the current price, based on market fluctuations.

February 11th, 2008 Posted by Nathan Weinberg | Yahoo Acquisition, Corporate, Yahoo | no comments



Why Would There By A Microsoft Exodus?

Josh Kopelman is running an ad campaign on Facebook that targets Microsoft employees who may be looking to leave the company to run their own startup. He ran the campaign three months ago, with a grand total of zero takers, and the same ads are now running with a surprisingly high click through rate. Does that mean that Microsofties are looking to leave, panicking at the idea of working for a Microsoft/Yahoo hybrid?

There are a number of reason’s Josh’s ad could be getting so much attention. First off, Facebook’s ad system has been getting a lot better, and is targeting well enough to perform better. When he first ran the ad, the ad system had just launched, and was filled with bugs and bad decisions. All ads are probably performing much better these days.

Also, the new year just started. There are a million reasons that employees might want to leave Microsoft after the new year, including vested options, re-evaluating their place in the company, new year’s resolutions, and, yes, the Yahoo acquisition. Some (and I mean a very small number proportionally) Microsoft employees are redundant in a post-Yahoo world, destined to be replaced by Yahoo employees who do good work on Yahoo’s successful products.

Others are probably panicking at the acquisition price and the debt Microsoft will be taking on. I’m sure there’s a fear that $44.6 billion, and at least $10 billion in debt, plus billions in integration costs and thousands of new salaries will sink the company. If all those fears add up to 15 out of every 1,264 Microsoft employees leaving the company, it’s not great, but it’s something the company can live with.

After all, Microsoft can just replace them with Yahoos.
(via Fred Wilson)


For continuing coverage of Microsoft’s planned acquisition of Yahoo, keep visiting this page.

February 7th, 2008 Posted by Nathan Weinberg | Yahoo Acquisition, Corporate, Yahoo | no comments

Microsoft and Yahoo’s Combined Market Share

Hitwise has a look at the visitor statistics for Yahoo and Microsoft’s websites, showing just how much market share in the United States the combined company would have. Total market share for all Yahoo is 13.2% of all of U.S. internet traffic, with MSN having just 2.4% and Google 7.7% Combined, they would have 15.6%, over twice as much as Google.

Thanks to the growth of Live Search over the last year, Microsoft/Yahoo would have 31.75% of the search market, fully half of Google’s position, with room for that growth to accelerate. Yahoo’s frontpage has an amazing 71.4% market share, 86.8% with MSN. Yahoo Mail has 54.6%, 80% with Hotmail, almost 84% with Yahoo Address book, leaving just 5.51% for Gmail.

Yahoo News (7.4%) plus MSNBC plus Yahoo Weather owns 13.3% of news and media. Yahoo Finance (29.15%) plus MSN Money equals 39.3%. Yahoo Maps (12.84%) plus Live Maps equals 16.59%, behind Google’s 22.64%. Yahoo Movies (8.33%) plus MSN Entertainment-Movies equals 15.44%. Yahoo Games (5.5%) plus MSN Games equal 7.68%.

And, let’s not forget Flickr, with 12.01% of the Photography market, #2 in its category, and Yahoo Music with 6.52% of Music, #1 in its category.

Hitwise also has a comparison of market share in the U.K.

Follow all the news on Microsoft’s acquisition of Yahoo on this page.

February 6th, 2008 Posted by Nathan Weinberg | Yahoo Acquisition, Yahoo, Google | no comments

Morgan Stanley & Blackstone Picked For Yahoo Acquisition

Microsoft has chosen Morgan Stanley and The Blackstone Group to run the complicated financial details of its acquisition of Yahoo. Morgan Stanley has strong links with both companies, though Microsoft has avoided using them for anything in nine years, and Blackstone worked on Reuters $17 billion deal last year. Both companies stand to collect $100 million in fees if the deal goes through.

Meanwhile, Yahoo is using Goldman Sachs and Lehman Brothers. Microsoft often uses Goldman, and Yahoo’s retainer of them could explain why they had to go with Morgan Stanley for this deal.

Follow the continuing coverage of Microsoft’s planned acquisition of Yahoo on this page.

February 5th, 2008 Posted by Nathan Weinberg | Yahoo Acquisition, Developers, Yahoo | no comments

Even ESPN Cares About Microsoft-Yahoo

Sorry about the flood of posts about the Microsoft offer to buy Yahoo, but there’s just so many things to say about it.

I just found this funny:

espn.JPG

Yes, ESPN fans will recognize that as the news ticker at the bottom of the screen on the sports channel. What does Microsoft Yahoo have to do with sports? Nothing! It’s just such big news, everybody’s talking about it.

Follow the continuing coverage on this page.

Here are the posts so far on this story:

Microsoft Offers To Buy Yahoo - Friday
A Detailed Look At Microsoft’s Offer To Buy Yahoo - (InsideGoogle link to InsideMicrosoft)
Microsoft/Yahoo Buyout Photoshop Contest
Which Yahoos Will Become Microsofties? - Monday
Does Microsoft-Yahoo Spell The End of MSN?
Google Tries To Make Yahoo An Offer It Can’t Refuse (InsideGoogle)
A Look At Windows Live Flickr
Microsoft Looking To Take On Debt Over Yahoo
Some Microsoft/Yahoo Overlap You May Not Have Considered

February 5th, 2008 Posted by Nathan Weinberg | Yahoo Acquisition, Corporate, Yahoo, Humor | 2 comments

Some Microsoft/Yahoo Overlap You May Not Have Considered

Do you really have any idea how big Yahoo is, or hell, how big MSN is? There’s a lot of overlap between the two, and Long Zheng & Josh Philips have been kind enough to generate a nice chart to show the two. The chart is reproduced below, with some notes added by me regarding what I think about which service will be rolled into the other.

Service Yahoo Equivalent Microsoft Equivalent Nathan’s notes
Content Portals Yahoo.com
Yahoo Auto
Yahoo Finances
Etc…
Msn.com
MSN Auto
MSN Finances
Etc…
Both sides have some great, well-developed portal sites. There’s no need for both, so the only way sites like Yahoo Autos and MSN Autos survive is if the companies waffle and keep both Yahoo and MSN alive, competing with each other.
Country-specific Content Portals ex. Yahoo7.com.au ex. Ninemsn.com Here’s part of the beauty of the acquisition. Yahoo and MSN have many international portals. In some countries, Yahoo is king, in others, MSN. Together, they combine to have #1 market share in almost every single market.
Account Management Yahoo ID Live ID Yahoo’s ID system, while good, is nowhere near as powerful or versatile as Microsoft’s. Microsoft’s multi-account switching and Windows Live Sign-In assistant would win anyday. Either way, Microsoft sticks with its own technology, so Yahoo IDs are dead.
Personal Homepage My Yahoo! Live.com MyYahoo is bigger and has more users, and a big history. The technology developed for Live.com will likely be rolled into MyYahoo, or exist as a more advanced option for MyYahoo users, but MyYahoo is king here.
Search Yahoo Search Live Search Both are big dogs, and both are struggling to catch Google. Both will survive, at least for a while, with Microsoft trying to find a way to combine the market share of the two eventually. Most likely, the search engine will fall under the Yahoo brand, but itcould go either way.
Casual gaming Yahoo Games MSN Games Both sites are strong, could be better, and will certainly be combined into one, possibly under the Yahoo brand.
Mapping Yahoo Maps Live Maps Not even a question. Microsoft loves Live Maps, and has invested heavily in it. Yahoo Maps is dead, but its engineers and some of its code may work for Live in the future.
Instant Messenger Yahoo Messenger Live Messenger Yahoo Messenger and Live Messenger already work together, making the path for the future easier. Live Messenger is more popular, and will almost definitely be the only client in the future, with added support for the Yahoo services and features it can take over from the Yahoo client.
Mail Yahoo Mail Live Hotmail Live Hotmail is one of Microsoft’s most important, strongest projects. Microsoft will avoid killing Yahoo at first, but development on Yahoo Mail will cease. Microsoft will offer Yahoo users the option to migrate their accounts to the ever-improving Hotmail, and eventually Yahoo Mail will phase out and die.
Community Help Service Yahoo Answers Live QnA Yahoo Answers is the amazing success story of 2007, while Live QnA never got enough traction. Live QnA is dead, and there’s even a chance Microsoft will not bother to integrate.
Photo Sharing Flickr Live Spaces Flickr will become tied to Live Spaces, with the millions of Live Spaces photos becoming part of Flickr. The two will thrive on each other and grow exponentially more successful. This will be the immediate crown jewel of the acquisition.
Blogging 360° Live Spaces Yahoo 360 is a failure. If Microsoft is nice, it may offer to transition accounts over, but 360 is dead.
Widgets Yahoo Widgets Windows Sidebar Yahoo Widgets is strong and has a nice library of Gadgets. The first post-acquisition release of Sidebar will add support for Yahoo Widgets, which will live side-by-side in Windows Vista.
Search Advertising Yahoo Search Marketing Microsoft adCenter The hardest part of the acquisition. It took Yahoo years to integrate Overture into its own ad systems, and if that happens to Microsoft, this entire acquisition will have been a waste. Luckily, Microsoft is very talented at integrating, at least when compared to Yahoo. Expect hundreds of employees to work on combining the two products, with a deadline of under 12 months, maybe even six months.
Mobile Yahoo Mobile Live Mobile Live Mobile isn’t fully developed, but an important part of Microsoft’s mobile strategy. Yahoo Go for Mobile is a great piece of software. There will be a fight inside Microsoft, but if the company is smart, it will continue to develop Yahoo Go as the iPhone-killer content browser.
Web Development Yahoo Developer Network Dev.Live.com Both will continue, as long as they continue to help developers with their platforms. No reason to worry here.
Web Mashup Tools Yahoo Pipes Popfly Yahoo Pipes is dead, but the engineers and code will try to live on at Microsoft. Popfly is too important to Microsoft to not win this one.
Website Services Yahoo Small Business Office Live Yahoo’s offering is dead. Office Live is much better, and important to Microsoft’s Office division. Yahoo’s customers will hopefully like Microsoft’s technology, which has been well invested in and is cheaper (or free).
Geocities
Social Events Upcoming Live Events Tough call. Live Events is really knew, and we don’t know how important it is to Microsoft. If they aren’t desperately attached to it, Upcoming could win.
Social Bookmarking del.icio.us (Advertising deal with Digg) Everybody wins. Microsoft keeps dealing with Digg, and puts development resources into del.icio.us.
eCommerce alibaba    
Music Service Y! Music/MusicMatch Zune Marketplace, MSN Music Microsoft killed MSN Music for Zune, and it will kill Yahoo Music, too. Microsoft will integrate or transition, and kill it off. Hopefully, Launchcast will survive, but don’t count on it.
Music Software Music Jukebox Windows Media Player Ditto.

What do you think? What is missing from the table?

February 4th, 2008 Posted by Nathan Weinberg | Windows Mobile, Office Live, Live, Windows Media, Mail, Zune, Yahoo Acquisition, Sidebar, Maps, Vista, Hotmail, MSN, Media Player, Applications, Search, Windows, Messenger, Yahoo, Spaces, General | 8 comments

Microsoft Looking To Take On Debt Over Yahoo

Microsoft’s offer to buy Yahoo isn’t cheap. In fact, the $44 billion offer is more money than Microsoft actually has, so the company is figuring out how to pay for it. The offer, as it stands, is for half cash, half stock, so Microsoft needs $22.3 billion in stock, and $22.3 billion in cash.

The stock is based on Microsoft’s closing price on January 31 of $32.60, so we are talking 684,049,080 shares, or just over 2/3 of a billion shares of Microsoft stock. If I understand how to read a stock summary (and I don’t, so correct me if necessary), Microsoft holds 1.3 billion of its own shares, so giving Yahoo almost half of those would still leave the company with plenty for its own purposes.

As for the cash, Microsoft has $21.076 billion on hand, but CFO Chris Liddel says it “could” use all of its money to cover most of the $22.3, which pretty much means it won’t. I’d expect Microsoft to spend half its cash, or 10.538 billion, leaving another $11.762 billion to cover the rest. Liddell says the company will borrow money, the first time it has done that.

Luckily, Microsoft’s a pretty healthy company. The company pulled in $5.8 billion in cash in just its last quarter, so give it a year, Microsoft could pay off that debt and still have plenty of spending money. Yahoo is profitable too, and hopefully, under Microsoft, even more profitable, so Yahoo is definitely something Microsoft can afford.

That question out of the way, we just have to wonder if Microsoft can make this work, turn Yahoo+Windows Live into the Google killer it keeps hoping for.



February 4th, 2008 Posted by Nathan Weinberg | Yahoo Acquisition, Corporate, Yahoo | one comment

A Look At Windows Live Flickr

Thomas Hawk, photographer extraordinaire and CEO of Zooomr, has a post on how Microsoft’s proposed buyout of Yahoo will affect photographers. Yahoo doesn’t have much in the way of photo-related services, except, of course, for Flickr, a hugely popular photo sharing website. Microsoft has:

  • Great Windows Live Photo Gallery software, for navigating, editing, and uploading your photos to the internet, including to Flickr
  • Ten million photo uploaders on Live Spaces
  • The next killer photo format, JPEG XR, in the process of being finalized and added to cameras
  • Photosynth, the software that combines thousands of photographs into a 3D space

… and lots of other programs and research initiatives that are paying off in the digital imaging space. The one thing Microsoft doesn’t have is a social website where users can share, rate, tag, and otherwise build an amazing photography community. With Flickr, Microsoft ties it altogether, and gains the best photo search engine on the internet. Flickr alone is worth, I’d guess, between $500 and $700 million to Microsoft, more than it is currently worht to Yahoo, and twenty times what Yahoo paid for it.

Thomas lists at least five other ways the buyout affects photographers. Read his article.

photo of LEGO Photographers by turkguy0319 under CC license

February 4th, 2008 Posted by Nathan Weinberg | Live, Yahoo Acquisition, Yahoo, Spaces, Search, Windows, General | 2 comments