Microsoft's offer for Yahoo: Why Google will loose.

[exponent]

First, lets look at the big 3 and the market capitalization of each company:

Google, Inc.
Market Cap: 164.38B

Microsoft Corp.
Market Cap: 284.51B

Yahoo, Inc.
Market Cap: 37.90B

Keep in mind that Yahoo stock is up 47% since this morning due to the announcement, thus the previous market cap was obviously significantly lower.

Microsoft and Yahoo! have a big problem. Online ads are booming, and they are getting left out. Microsoft's online business racked up a loss of $248 million during the quarter ending in December. Yahoo! makes money, but its earnings are slipping fast: Net income fell 23 % to $205.7 million last quarter from $268 million during the year-ago period. So why would Microsoft pay such a high price for Yahoo?

Its OBVIOUS if you know where to look.

Yahoo Earnings (2007)
6.97B

Google Earnings (2006)
10.6B (around 12B for 2007)

Here comes the kicker you've been waiting for. Yahoo lost its spot to Google because it became comfortable with being a leader. This is similar to the way HP-Compaq lost market share to Dell and then regained it. If you look at Google, the aura of invincibility has been cracked in the last few months, as shares are down 31% from the 52-week high of $747.24, reached on Nov. 7, 2007.

Yahoo can only go up. It has great earnings but makes very little money because the company has been trying to catch up with Google. Once the creative talent of Microsoft and Yahoo come together, there will likely be thousands of additional layoffs. However, Microsoft is extremely good at cutting costs to reshape the dynamics of its various divisions.

Enter aQuantive.

If all goes as planned, after closing a deal with Yahoo, Microsoft will now have a network that rivals that of Google. Firstly, Microsoft purchased aQuantive, a well developed, high end network. Yahoo purchased RightMedia, laying the groundworks for the underdeveloped Yahoo Publisher Network. You may be asking where this comes into play. Remember Facebook? Microsoft is the premier ad delivery system for Facebook. Under current projections, Facebook will be bigger than MySpace in the next 12 to 18 months.

If it hasn't become clear, Google has been edged into a corner by its own success. While Google has been snapping up companies (Feedburner, Picasa, DoubleClick), Microsoft has been building an advertising juggernaut. Search isn't the reason behind the acquisition, ads are.

The Battle of the Messengers.

Combining YIM and MSN Messenger, Microsoft will now have the largest undisputed instant messaging network in terms of active users. I say active users because AOL/ICQ is larger by far, but mostly abandoned. Personally, it make take years to bring Google down from #1 in search, but looking at the overall picture, things are definitely heating up.

Google reported total 2007 profits of 4.2 billion dollars.

Checkmate.

 

[~ The 34 Year Buzz!!]

Love it

 

[exponent]

It makes you wonder if eBay is next. It would shore up the online experience and Microsoft-Yahoo! could benefit from Skype.

On the other hand, acquiring Amazon.com would be a nice grab too..

 

[shockie]

google must be loosening up already!

 

[John Doe]

Often 1+1=1,75 after such acquisitions. Google has steadily taken away market share from Yahoo and MS. And Google has about 15 billion free cash vs Microsoft 19 billion.

 

[.X.]

The great part is, Google doesn't have the funds to compete, Bill Gates himself, aside from Microsoft, Could buy Google, and it would have little effect on his pocket book.

I am glad to see this happening, Google has earned it, And deserves it, In this particular case, I say screw ethics, and dethrone Google.

 

[nicholas]

Yahoo! finally gets the chance to rehabilitate is failing fortunes. Google is sure to be spooked. But not for long. Even with both companies combined, Google's share of the search market is still more than double (that's where they really make their killing); and in the end, that's the one metric that matters.

 

[John Doe]

The great part is, Google doesn't have the funds to compete, Bill Gates himself, aside from Microsoft, Could buy Google, and it would have little effect on his pocket book.

I am glad to see this happening, Google has earned it, And deserves it, In this particular case, I say screw ethics, and dethrone Google.

Yeah, Google actually has enough money for anything. Just look at the balance sheet. Do you like more ethics of Microsoft? :hehe:

 

[Chris.]

First, lets look at the big 3 and the market capitalization of each company:

Google, Inc.
Market Cap: 164.38B

Microsoft Corp.
Market Cap: 284.51B

Yahoo, Inc.
Market Cap: 37.90B

Keep in mind that Yahoo stock is up 47% since this morning due to the announcement, thus the previous market cap was obviously significantly lower.

Microsoft and Yahoo! have a big problem. Online ads are booming, and they are getting left out. Microsoft's online business racked up a loss of $248 million during the quarter ending in December. Yahoo! makes money, but its earnings are slipping fast: Net income fell 23 % to $205.7 million last quarter from $268 million during the year-ago period. So why would Microsoft pay such a high price for Yahoo?

Its OBVIOUS if you know where to look.

Yahoo Earnings (2007)
6.97B

Google Earnings (2006)
10.6B (around 12B for 2007)

Here comes the kicker you've been waiting for. Yahoo lost its spot to Google because it became comfortable with being a leader. This is similar to the way HP-Compaq lost market share to Dell and then regained it. If you look at Google, the aura of invincibility has been cracked in the last few months, as shares are down 31% from the 52-week high of $747.24, reached on Nov. 7, 2007.

Yahoo can only go up. It has great earnings but makes very little money because the company has been trying to catch up with Google. Once the creative talent of Microsoft and Yahoo come together, there will likely be thousands of additional layoffs. However, Microsoft is extremely good at cutting costs to reshape the dynamics of its various divisions.

Enter aQuantive.

If all goes as planned, after closing a deal with Yahoo, Microsoft will now have a network that rivals that of Google. Firstly, Microsoft purchased aQuantive, a well developed, high end network. Yahoo purchased RightMedia, laying the groundworks for the underdeveloped Yahoo Publisher Network. You may be asking where this comes into play. Remember Facebook? Microsoft is the premier ad delivery system for Facebook. Under current projections, Facebook will be bigger than MySpace in the next 12 to 18 months.

If it hasn't become clear, Google has been edged into a corner by its own success. While Google has been snapping up companies (Feedburner, Picasa, DoubleClick), Microsoft has been building an advertising juggernaut. Search isn't the reason behind the acquisition, ads are.

The Battle of the Messengers.

Combining YIM and MSN Messenger, Microsoft will now have the largest undisputed instant messaging network in terms of active users. I say active users because AOL/ICQ is larger by far, but mostly abandoned. Personally, it make take years to bring Google down from #1 in search, but looking at the overall picture, things are definitely heating up.

Google reported total 2007 profits of 4.2 billion dollars.

Checkmate.

Great post and wording.

 

[.X.]

Yahoo! finally gets the chance to rehabilitate is failing fortunes. Google is sure to be spooked. But not for long. Even with both companies combined, Google's share of the search market is still more than double (that's where they really make their killing); and in the end, that's the one metric that matters.

I think Yahoo can over take Google, And become the top search engine, as well as the leader in ad publishing and XML feeds

Google virtually has made their own bed, They have an arguably communist type approach, when dealing with their customers and clients, Their terms of service never have been stable, they change them every week, As i said, they have made their bed, now they must lay in it.

Yeah, Google actually has enough money for anything. Just look at the balance sheet. Do you like more ethics of Microsoft? :hehe:

In Comparison to one another, Yes, I think MS is the more ethical company.

Do you have any idea what Bill Gates himself is worth? Microsoft is worth X amount of dollars, Bill Gates is Worth X amount of dollars, Which far exceeds what Google is worth.

And Google knows it too, And they must be feeling fear right now.

 

[*AllThings.tv*]

How long until Microsoft releases a free OS with ads built in that can be updated by Microsoft remotely!

 

[salesdd]

google must be loosening up already!

Agreed, it is.
Style concerned.

 

[shockie]

google must be loosening up already!

Agreed, it is.
Style concerned.

my style is of no concern.

 

[Mike]

How long until Microsoft releases a free OS with ads built in that can be updated by Microsoft remotely!

Now there's someone thinking on his feet! I don't think it's going to happen anytime soon, but i believe this to be an incredibly smart move to regain the ad market.
*******************

Personally, i prefer MSFT over Google any day of the week. Google has completely lost their appeal to me. The once creative underdog has become too much to handle and accept. It's about time time that someone takes them down and reduces their ego to what it should be.
MSFT has my full support in this.

M.

 

[nuclearwerewolf]

<3 Google...

I personally feel that Google is God King of search and related industries. I feel that even though they are at the top, they are still innovative. They find ways to make things adaptable in both pre-existing technologies and/or unique technologies. I do not want to see their downfall but I certainly love competition. Yay Microsoft for starting to fluff some pillows.

As for the release of the Free OS...
Google would do that first. The market of OS is slowly starting to shift to Macs OS (A variation of Linux) because they have some frigging sales pitches of software and hardware, that hurt.
Fact: Unix is the backend to all if not most Google infrastructures.
Think about it. This is a possible scenario for many reasons but don't you guys see a release, after a large shift to the mac community? I do, but that's MHO.