The desktop software leader had started another wave in information technology world by offering about 45 billion-dollar to worlds no one portal yahoo.com. Microsoft being the leader in the desktop world was concerned about its position in the Internet world. Googles innovative style of management, latest style of marketing & leading position of search domain on the internet forces the Microsoft to go for such hostile takeover. For the first time, Microsoft will borrow the money from the capital market for this take over said Chris Liddell CFO, Microsoft. Earlier Microsoft had acquired an online advertising company in august last.
Six months ago Goldman Sachs had done Yahoo buyout feasiblity study for Microsoft through JP Morgan Securities. Then deal was valued at $50 Billion.
Yahoo is clicking because Microsoft and Yahoo struggle to compete with google for the lucrative online advertising market. Online advertising market is currently worht $ 40 billion and expected to grow to $80 billion by 2010.
There was other person in the picture i.e. Rupert Murdock. He recently acquired Wall Street Journal.
The competition between Microsoft and Google:
Now yahoo bosses are reconsidering an earlier alliance, which was proposed several months ago by Google. Yahoo may consider the offer from some other bidders only to increase the bid amount by the Microsoft. When Bill Gates & Steve Ballmer move towards Yahoo, it was natural unrest for the peoples in Googleplex. Yahoo is the number one portal & Number one place for the advertising. Chief Legal Officer ‘David Drummond of Google accused Microsoft of seeking its monopoly in the desktop market deeper into the Internet domain. He called on the policy makers to challenge the combination, because it will undermine the competition on the Internet.
Desi Effect:
Google may loose its pricing power in the country after Yahoo goes to Microsoft. Small dotcom companies in India may also be effect in this situation for the advertising revenue they get from the Google. The two strong places for the advertisers will make the market more competitive. It is also possible that Yahoo and Microsoft together will compete against Google more effectively with its search related product advertising. Google and Gmail enjoy 32.3 % in India, Yahoo is 26.6 % & MSN, which is owned by Microsoft, is only 1.9 %.
Earlier Deals in Information Technology Space:
In 2000 AOL buys Time Warner for $164 billion creating AOL Time warner. This was the major meger of _______ & ________ creating the new company of _______ $. In 2006 Google acquires YouTube for $1.65 billion. eBay acquired Paypal for $1.5 billion. Microsoft acquired Hotmail for $400 million from Sabir Bhatia in 1998. If this deal goes through it will be biggest merger in the Information Technology space after Time-warner acquisition. Microsoft last acquired a Desktop visualization solution compnay ‘Calista Technologies’ founded by an Indian technie Anil Kumar. With Microsoft’s reputation as ‘a destroyer of companies ‘does not expect any particular fireworks in the industry. Microsoft brought Sabir Bhatias Hotmail in 1990 but fail to make it a learder in the email space.
Yahoo was founded by the two Stanford graduates Jerry yang & David Filo in 1995. It was one of the first companies to popularise web searches going back to the mid-90. In last few years Google has gone ahead of Yahoo in recent years. Yahoo’s net income is $660 million with 13,600 employees.
Earlier Yahoo was named as Jerry's Guide to the World Wide Web", which was the personal interest of web sites. Yahoo also progvide different mobile services like moblogging i.e. bloogin through mobiles.
Other person David Flengo is the businessman
In a recent speech Jerry Yang CEO of Yahoo at Consumer electronics shows in Las Vegas. He apologyies for the poor results of Yahoo, Yang revealed yahoo’s final quarter profits had fallen to 23%. He promised change and better times ahead.
Bill Gates & Paul Allen founded Microsoft in 1975. Ithas net Income of $14.06 billion with 79,000 employees.
Google is known for innovating working culture, environment friendly corporate offices like Googleplex.Google was founded Ph.D dropouts Larry Page and Sergey Brin from Standford University,
Google is popularly known as most innovative and fast searching facility avialable on the web. With most innovative products like Google Video, Google Calender, News, Finance, Map and Earth it is more favourite on the Internet domain. Google is also set to release free office software. Google will also be in the mobile telephony business. Google provide free wireless Internet service in the Moutain View, California.
Google acquired the Pyra Labs and blogger. Most recent was the youtube and doubleclick. It also has acquired postini as messaging security Firm.
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