Posted by: Shalabh | May 5, 2007

Why Yahoo should’nt sell (to Microsoft)

50 billion dollars- thats what ‘Takeover pundits’ are puntering for Microsoft’s alleged bid for Yahoo.

http://www.nypost.com/seven/05042007/business/bills_hard_drive_business_peter_lauria_and_zachery_kouwe.htm

Is it worth it? Prima Facie For Yahoo yes. Earning a few times of the entire online industry size should be worth it. For Microsoft? Maybe Yes- they haven’t done anything substantial or ground breaking anyways- either in display or search advertising. They just get by (ahem!) because they are Microsoft. They lost Double click, they lost AOL, now might be their chance for consolidation.

But whatever the ‘money sense’ is, the reasons why it should never happen- why Yahoo should not sell to MS (or Google) or vice versa (!!) Some fundamental (and emotional) reasons:

  • The Online advertising web has just three major players- consolidation amongst them is going to make others more powerful-result? Less democratisation of content, communities and structures. Not good.
  • The Net thrives on constant innovation- innovation is spurred by different minds/ideologies and talent pools. Congregation is not good for innovation. Not good for the world wide web. Not good for us surfers.
  • Would you rather everyone in the (real) world wear suits and ties and speak in English -ONLY? It’ll be a dull, monotonous, colorless world. Online world is no different- we want giants who are different. There will always be small talented rebels who stick to their ground (Facebook?) We need color! We need choices.
  • The advertising market will become pretty much a sellers market- never an ideal scenario (specially with MS’s sales approach- let the sales agency do the ‘dirty’  work- we are MS!). Planners have lesser choice, clients have lesser confidence in planning agencies, and offline agencies move their offline buyers/planers to do the ‘simple’ work (its just so easy- Mike from procurement/TV buying can call and buy media from one publisher- no point in going to a specialist!). OK I’m over simplyfying things- its not that 3 or 2 are much different- but thats the way a lot of people think in the industry. It isreally a perception game.
  • The logo “Yahoo!- a Microsoft company” will sound extremely ironic and oxymoron-ish
  • There are a handful of iconic web brands- Yahoo is amongst the first. Reinnovate and hang on. There’s a long way to go
  • Search will just begin to be interesting. Ask Jeeves is trying to come up, Panama is anticipated widely, MS (hopefully) will launch a better search system- and they have the traffic as well. Good competition, everyone on their toes, better technologies.

Don’t sell Yahoo- Hang on. Maybe Panama will solve some issues- stand up Mr Semel (If you still will be on)- resist!

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Responses

  1. Cool. Thanks


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