Microsoft shareholders should thank their lucky stars that the company is not merging with Yahoo!
A $44 billion dollar merger of two honest-to-gosh behemoths is not something that would ever work in a million years. Just look at Microsoft's track record with mergers. For the most part, it stinks.
I recall, back in the early dot-com era, when Microsoft bought WebTV for something like $400 million (one-hundredth of what it was going to spend on Yahoo!) — its biggest deal up to that point.
What ever happened to WebTV? It kind of sat there in limbo, and part of it morphed into MicrosoftTV, which was a response to AOL TV and some other junk coming onto the market. It was a joke.
By the way, for years, Microsoft was preoccupied with AOL the way it's now preoccupied with Google. Hence the MSN squander-fest.
There has been a slew of ridiculous Microsoft failures, but nothing that comes close to the potential Yahoo! debacle.
This whole episode reminded me of the crazy wife in the 1985 Albert Brooks movie "Lost in America." The movie is about a couple who take their savings and buy an RV to see the country. They make a quick stop in Las Vegas, and almost within minutes, the dingbat wife gambles away their nest egg.
Hello, Steve Ballmer.
What seems strange to me — stranger than Ballmer's plan to blow the Microsoft nest egg to buy Yahoo! — are the idiotic Silicon Valley analysts who were encouraging the deal.
Wait, did I say idiotic? Ah yes, idiotic. It's as if the entire high-tech financial community was thinking that this was a great idea and the only way Microsoft could compete with Google, ever.
Earth to Silicon Valley: Microsoft competes with Google in only a small way. Microsoft makes most of its money from an operating system and something called the Office suite.
Google makes no OS or any serious office software, except some online junk that actually competes with software from 1985. (Remember the company Personal Software and its simple word processor and other easy-to-use stuff?)
Yeah, big threat to Microsoft's core business.
Software Is Not a Dead End
Then again, Silicon Valley is home to other litanies of doom where tech is concerned.
Let's see, there's the one about how Microsoft cannot keep selling an Office suite and an OS. That one first appeared around 1990.
More recently, folks say that Intel cannot survive just making microprocessors. Nah, it "has" to do something else, like produce networking chips. The microprocessor is dead. That thinking is more recent, like around 1998.
Oh, and then there's the one I first heard in 1982 when I was editor of Infoworld, which surmised that by 1985, there would be no more hard disks and everything would be silicon-based. It was a done deal.
And coming in and out of vogue is the fabulous insight that the age of the robot is upon us, and it's going to happen any minute. I can go on.
The fact is that Microsoft has squandered its shareholders' money and has chased far too many idiotic dead ends over the years with dumb purchases, forgetting that it's a software company. And it seems to have lost sight of the fact that there is no better business than the software business once you are established and know how to make the software business work.
Let me point out something else. Software is not a dead end!
So why would Microsoft want to get into the crazy businesses that Yahoo! plays in — social networks, advertising sales, photo-sharing sites, search directories, personal ads, phone-sex come-ons, news summaries, stock charting, scrapbooking, dogs and cats, MySpace wannabees and so on?
Are you folks at Microsoft clinically insane? Have you not learned your lesson from MSN — the wannabee AOL killer? Cripes, get a grip.
This is all because the new kid, Google, which has nothing to do with you in reality, came along and is making money with a search engine. Oh no, hit the panic button! Let's spend all our money in an effort to, uh, compete with Google.
What is it with all the geniuses who think this was a good plan? Do the math. Forty four billion and you were considering spending more!? For what?
Earth to Microsoft: Yahoo! is not worth $44 billion. You could buy General Motors lock, stock, and barrel for $14 billion, name all the cars "Google Sucks" and get more bang for the buck.
Heck, you'd have enough left over to buy Ford for around $16 billion, and you could name all those cars "Google Sucks More" and still have $14 billion left over for a big party.
Does anyone ever look at the market cap of these multinational firms for a reality check?
Microsoft wanted to oust the Yahoo! board of directors. It should oust its own. Geez. No wonder Linux is gaining ground on you guys.
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