back to article Microsoft to Yahoo!: Surrender or else

Microsoft has told Yahoo! that it has three weeks to walk down the aisle - or it will strong-arm the reluctant bride into marriage. If this ends in a proxy battle, Microsoft will almost certainly return with a lower offer than the $44bn bid originally tabled on February 1. In a letter to the Yahoo! board delivered on Saturday …


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  1. Alan W. Rateliff, II
    Paris Hilton

    So what will be the bastard product?

    Will Microsoft search products suddenly improve, or will Yahoo!'s go to shit? Because let's be realistic about this, Microsoft knows dick about search. You can get a KBA faster using Google...

    Paris, because she ruined Hotmail, too.

  2. Nomen Publicus
    Dead Vulture


    So what is so attractive about Yahoo? What products and services would be expected to flourish under the dead hand of Microsoft management?

  3. Richard

    Good news

    This is good news for us penguinistas. We get to watch while MS mismanage Yahoo and its FreeBSD-/Perl-/free software-loving employees into the ground, and at the same time MS lose $44bn from their cash pile. I really hope the EU don't oppose this one.

  4. Anonymous Coward

    Forget the Yahoo board what about the Microsoft one?

    As a Microsoft shareholder what are our board doing to stop this crazy transaction? It's already wiped $6 off the share price, the offer will take the company into debt in a recession and there is no record of any merger of this size EVER returning positive shareholder value except for people in the acquired company. The integration costs are just too high and payback too small over too long a period.

    If the MS board had balls they would have fired Bulmer years ago he's done NOTHING to increase the value of the stock during his tenure.

  5. xjy

    What's good about Yahoo?

    Well, at least they're persistent and not totally besuited. Their take-over of Flickr was not a total disaster - I'm still on board, at least. Their advice site is fun. An awful lot of people depend on their mail and messaging. The thought of M$ taking over is unpalatable to almost everyone but beancounting shareholders. With the market the way it is, an independent Yahoo seems necessary. Even a Google take-over would be preferable from the users' point of view. M$ is obviously completely indifferent to the fact that most of those who give Yahoo any kind of user cred will either jump ship ASAP or put on their lifejackets and get out on deck in readiness.

    Strangle, stifle and stunt... with twice the bloat of Jabba the Hutt and half the charm...

  6. amanfromMars Silver badge

    Steve on the Rampage .....Memo: Adjust Medication

    "It is unfortunate that by choosing not to enter into substantive negotiations with us, you have failed to give due consideration to a transaction that has tremendous benefits for Yahoo!’s shareholders and employees. We think it is critically important not to let this window of opportunity pass." ....... the last paragraph in Stevie Boy's letter.

    I cannot conceive of them doing anything other than giving it due consideration.

    Jumping into bed with a pox-ridden whore, no matter how tempting the offer, is not everyone's idea of an opportunity with tremendous benefits. It is a critical decision indeed, normally very easily made though........ and especially so whenever the world is fully of fresh young virgins only too pleased to learn what is to be taught.

    It is easy to offer Flash Cash whenever it is practically worthless and offers nothing of value.

  7. Eponymous Cowherd

    No items of furniture were harmed....

    during the writing of this letter.

  8. Anonymous Coward

    The Microsoft World

    >>Ballmer voiced his company’s frustration with Yahoo!’s dilly-dallying,

    >> noting that there has been “no meaningful negotiation to conclude an agreement”.

    No such thing as rejection: just no meaningful negotiation!

    From anybody else the arrogance would be astonishing.

  9. Anonymous Coward
    Anonymous Coward

    They'll pay more

    If they are forced to go to shareholders then they'll pay more not less. They know it, the Yahoo board needs to give the thumbs up to keep the price they'll pay down. If they didn't need the board they'd have bypassed them long ago.

    Microsoft is losing to Google online and soon Google will attack their OS (Android) and Office (Google Apps) products, without those they're a minor player.

    How much is that worth to Microsoft? I reckon a 100% premium, maybe 150% premium over the shareprice.

    Consider it another way, which other major web presence can they buy in place of Yahoo, if they decided Yahoo was too expensive?

  10. Anonymous Coward
    Anonymous Coward

    With luck they'll sell the messenger

    Seriously. YIM losing the features that make it better than MSN do not want.

  11. Anonymous Coward
    Anonymous Coward

    That will be fun

    Finally everybody reluctant (like me) will have a reason to ditch Yahoo! Mail for Google.

    And knowing MSFT, they'll try to replace all UNIX boxen at Yahoo! with Windows. Anybody remembers Hotmail transfer? And problems that resulted and still exist?

    Can be fun to watch ;)

  12. Kimberly Burgess


    RIP Yahoo, and all of your open source support. :( Evil MS will win the day.

    Penguin, because OSS is mourning.

  13. Rick
    Gates Horns

    Shotgun! wedding!

    My thoughts are why isn't AT&T taking any interest in this? I mean they have partnered up with Yahoo! to provide internet based applications. would make sense after looking at their strategic partners list.

  14. Andy Barber


    I doubt Microhoo! will be after the search engin. It's about the email & all the Value Added product Yahoo! flog. Yes I pay for my Yahoo! Flickr! account - it's the cheapest way to store >6000 photo's

  15. Chris Simmons
    Jobs Horns

    I know... doesn't really fit too well with the names of the two businesses, but "Magoo" immediately sprang to mind.

  16. Brian Miller

    Time for Yahoo! to eat Microsoft

    Anybody remember the 80's and the corporate raiding? Yahoo! can float junk bonds and make a leveraged buyout of Microsoft. They do that, everybody will be shouting "Yahoo!" for sure!

  17. Fatman

    Microsoft to Yahoo:

    Balmer is his best "Borg" voice:

    Resistance is FUTILE!!!!!!

    You will be assimilated!!!!!

  18. Ben Bradley


    Agree with the KB thing. MS's website search is rubbish, especially trying to find a particular download.

    My worry is about the most excellent Zimbra groupware system that Yahoo decided to purchase last year. The best competitor to Exchange (far better IMO) there is, and based on trusted open-source technology!

    MS will crush it, and I'll be annoyed :(

  19. Gordon


    That's that fucked up...

    Google must be smiling with Delight, i'll tell you that much.

  20. Anonymous Coward
    Anonymous Coward

    Kudos to Yahoo...

    for having the balls to stand up to M$

  21. Andy

    yahoo is teh Sux0r - microsoft sh0uld take over N0W

    microsoft taking over yahoo is the best thing that could happen to it, it will put it out of its missery, it is underused, has a crap email system, is unreliable and slow, i pay $14 a year for a hotmail account have http acces through outlook, a 5gb sky drive (to store all my files etc) only had it not work once in the last 3 years of using it, and support is excellent, the only reason google is popular is because people think it is popular, when it fact it is driven by advertising and cookies which probably collect all sorts of stuff from your pc without you knowing, as for microsoft going into debt, $44million is hardly going to put a big dent in there bank accounts really

  22. Peter

    To Yahoo

    If you are going to go with an MS offer, sell me Zimbra first. Happy to cover my costs and otherwise keep it open source.

    After all, MS aren't after it specifically right?

  23. Fast Freddie

    Take This!

    Yahoo! best text based email on the internet (html not so safe).

    eBay! best ecommerce site on the internet.

    Yahoo auctions not so good.

    Ebay! messaging not so good. (poor)

    Yahoo! search - OK...

    Ebay search - Killer...

    Yahoo! and eBay! team up and callit YuTo! (you guys only have three weeks eBay will be next if Yahoo! falls.)

    Now go forth and kick butt!

    Both Yahoo! and eBay! are undervalued.


    Google = ADVERTISING

    they should buy each other


  24. Joseph Helenihi

    @Brian Miller

    "Yahoo! can float junk bonds and make a leveraged buyout of Microsoft."

    You, with the incredible irony, stop that right now!

  25. John Latham


    "as for microsoft going into debt, $44million is hardly going to put a big dent in there bank accounts really"

    It's 44 BILLION DOLLARS*. Which might be worth about €44m sometime soon, but will still give MS's bank balance a kick.

    This seems like the greatest deal since AOL Time Warner.


    * For that money I'd want sharks with frickin' laser beams, not to mention an army of robot monkey butlers to pick up the broken furniture.

  26. prathlev

    @Andy, and Yahoo! not being ftw

    I'm really glad you took the time away from your 24/7 Halo gaming to explain that M$ is teh bestest and Yahoo! sux0rs. I think you should consider hiring amanfromMars to help you out with your homework (and speling) by the way.

    Losing Zimbra would be a sad thing indeed. It would be nice if a fork would be possible, otherwise Microsoft will probably kill the competitor once it's on their hands.


  27. I. Aproveofitspendingonspecificprojects
    Gates Horns

    > Microsoft wiped $6 off their share price

    Microsoft wiped $6 off the share price when they forgot to invent a mini OS for diddy laptops.

    Fair enough, I only jess seed it meself.

    But I am not a company making millions from an OS that is worth less than a Linux distro and selling it for the price of an XO.

    $6.oo, that's hardly the real value of an XP OS is it? And it is $7.oo more than the value of a Visa OS (provided the Visa doesn't go down on your files and ruin your company. (Terms and conditions apply.))

  28. Dave Bell

    And the mailing lists?

    I only have a Yahoo ID because they took over mailing list providers.

    And aren't Yahoo entangled with BT?

    O joy!

  29. Anonymous Coward
    Gates Horns


    Myself and the other three people on earth who use AltaVista are in consensus that Mihoo! would be a bad thing, but the name would be awesome. Mihoo!, Mihoo!, MihooOoo!. It just sings to ya.

  30. amanfromMars Silver badge

    Monopoly Money ...... PlayDough

    "* For that money [44 BILLION DOLLARS] I'd want sharks with frickin' laser beams, not to mention an army of robot monkey butlers to pick up the broken furniture."......By John Latham Posted Monday 7th April 2008 03:49 GMT

    For that sort of money you'd virtually easily get whatever you wanted, John, and it would be just so easy. Which highlights the problem being a Personal Mr Steve "I don't get this Virtualisation lark" Ballmer/MS "We haven't cracked this Virtualisation lark Code yet" Personnel problem.

  31. Eponymous Cowherd

    @ Dave Bell

    ***"And aren't Yahoo entangled with BT?"***

    Yes, they are.

    BT snuggling up with Microsoft as well as Phorm. Definitely time to move to another ISP.

  32. Anonymous Coward
    Anonymous Coward

    Re: And the mailing lists?

    "And aren't Yahoo entangled with BT?"

    Amongst others, yes.

    The also appear to be in bed with T-Mobile, at least if all the spurious advertising (for which read 'Y!' icons) on my mobe are anything to go by.

    Can't honestly say that the demise of Yahoo would leave a gaping hole in my life - their finance pages are good, but that's about it.

    We really need a 'Meh!' icon to go with thumbs up/down ...

  33. Jamie

    Old Tricks

    Well it appears that MS will just go back to thier old tricks and strong-arm anyone they want.

    Who wants to bid on how long MS can maintain thier current position with this type of attitude in the current market place.

  34. Giles Jones Gold badge

    Re: Yahoo

    "So what is so attractive about Yahoo? What products and services would be expected to flourish under the dead hand of Microsoft management?"

    Have you used Flickr? it's pretty much *the* site for photographers.

  35. Anonymous Coward

    Typical MS

    This is all reminiscent of MS's earlier days, before their complete and total domination, they used to do hostile takeovers/buyouts or sue their competitors into liquidation. If they acquired a company with similar technology, they usually just shut the projects down and integrate anything they want into their own existing s/w. Surely this acquisition is anti competitive??

    I run/use a yahoo groups list and use flickr, and pay for flickr. I've never paid MS for anything and would sure hate to lose flickr if it went into MSs and innovation killing greedy hands.

  36. Anonymous Coward

    Do it

    Having worked at Yahoo I would have to say that replacing the board (and most of the managers) would do it the world of good. It has no direction, it just tries to compete with google.. and fails. And for the record Microsoft are desperate to gain search market share in search on Google and so Yahoo is their best option for this.

  37. Anonymous Coward
    Anonymous Coward

    Search market

    Yahoo board may lack direction, but thats still a notch up from their products being bastardized by MS.

    Also i dont see MS's acquisition benefiting MS in the search market.

    Way i see it is if...

    a. MS acquires Yahoo, shuts down Yahoo service, most Yahoo people will go to Google, not MSN, especially if they are existing net users, MSN Live search perception will still be status quo. Only new users may go to them

    b. MS acquires Yahoo, keeps Yahoo going, people still use Yahoo, unless MS deliberately savage Yahoos search capacity and in which case people go to Google.

    Either way, they cant win!

  38. Greg

    Maybe bad for the world, but clearly good for Share!Holders!

    Those critical of the deal and saying Yahoo board is right to reject it miss the basics of public companies board duties.

    And this has nothing to do with the degree of anti-microsoft they, or anyone here, may have (and I'm far from being last in microsoft-bashing and -hating)

    Board members and managers of a public company have two, and only two, duties:

    1- Respect the laws and ensure their company respects them

    2- Maximize the value of the EXISTING shareholders investment.

    They have no right to care about the future of a Microhoo company, in fact they have a duty to absolutely and completely ignore it.

    What they must do is do anything they can to have their existing shareholders get richer.

    Microsoft is offering $44 billion. I don't care what the future will look like for microhoo.

    The only question is: will the current shareholder be richer if Yahoo stays independent for the next 5 years and he sells then, or will he be richer if the deal is done, and that shareholder cashes out and buys American Tresaury bonds with a 5-year remaining maturity with the money?

    If allowing the shareholder to cash out is better for that shareholder, then the board is legally bound to accept the offer, even if it means yahoo is destroyed in the process, and 1 billion people migrate to google as a result.

    It's not their problem, and if they care more about the company itself than about the owners of the said company, they will rightly end up very poor, or even in jail.

    To sum this up, if Jerry Yang was the owner of yahoo, he would probably be right to reject the offer: it's his baby, he doesn't want to see it die, even if he would be richer by killing it. But he's not the owner of yahoo, nor is any boardmember, alone or collectively with the others. As a consequence, if killing yahoo brings more money, the law mandates they actively and quickly kill the company they manage.

  39. James Pickett


    "a quick and friendly transaction"

    First time I've seen the words 'friendly' and 'Ballmer' in the same sentence.

    I don't suppose he's considered the number of Yahoo subscribers who will jump ship if this happens. I like Flickr, but not enough to carry on with it under that sort of new management...

  40. James Pickett


    An introduction:

    Andy, Shift key; Shift key, Andy - Charmed, I'm sure.

  41. Graham Wood

    @Ben Bradley

    Oooh - hadn't thought about this.

    Killing a competitor to exchange IS worth 44gazillion to microsoft....

  42. Roger Heathcote

    @Greg - Fuck the shareholders.

    You write like you think that's a beautiful thing Greg! Thus is the sorry state of the world, the worlds biggest technology companies are run by hedge funds and pension funds who's sights stretch a few years at most, ignorant of the need for long term stratergy, R&D and investment.

    Brilliant isn't it? A world where the people in charge aren't legally allowed to consider anything outside of the profits of a bunch of people who don't know or care DICK about the future of the business! - It's a miracle it works at all really.

    IMHO things need to be done now and if shareholders can't bring themselves to take any responsibility then fuck them, our governments should step in. I'd rather suffer the market distortions of governement intervention than the market distortions of monopoly and ultra concentrated capital. At least then we might end up with a decent IP infastructure and more than two free webmail providers in the future. At this rate we'll be lucky to have a software market at all in 20 years time. :-/

  43. Greg

    @Roger Heathcote

    I'm not saying at all that it's a beautiful thing, just stating that the law is such that they don't have a choice.

    And that they shouldn't try to do anything illegal on that one (though it does not at all mean that I necessarily approve of the law, just that it needs to be respected or changed in general, not to be dismissed by Yahoo because Yahoo's board would be uniquely above it).

    What you say about government intervention, whatever the views of different people on government, woudl actually, as you say, be much more acceptable than Yang rejecting the offer.

    Government may be right or wrong to do something, but at least it has a right to. Yang and al do not have a right to reject Microsoft's offer, unless they can give reasons tending to prove the actual owners of the company will fare better if offer is rejected.

    To say it in another way, I never intended to say that accepting the offer was good or bad for society at large, just that it's not the board's role to consider this (but it is the government's).

  44. Tall
    Jobs Horns

    "Magoo" means "I can" in Russian

    "Magoo" means "I can" in Russian, not an appropriate name for this could-be venture :)

  45. amanfromMars Silver badge

    Mad Hatters C++ Party? ....... New Script needed, pronto, Tonto.

    "It's a miracle it works at all really."..... By Roger Heathcote Posted Monday 7th April 2008 11:39 GMT


    The Dodge worked well enough whenever the World was compartmented/partitioned/time zoned and knowledge couldn't be shared in an instant. Nowadays, the dodges needed to prevent the tricks of the trade and deeper knowledge being shared with all, are exposing the miracle to be a fat cat confidence trick perpetrated by self styled autocracies to oppress and dominate to maintain old style feudalism rather than anything else.

    Building empires on the backs of the uneducated/undereducated and then constantly recycling their wealth generation into currency which employs the unskilled pencil pusher/executive decision maker/Intelligent Designer who are charging for nothing more than a service rather than a product, is only viable for so long before it all starts to fall apart with the pursuit of money and profit taking over from the value of the service provided.

    After all, Profit aka Money for Nothing makes everything increasingly more and more expensive and banking the cash, and allowing the banks to gamble with it amongst themselves and also to feed themselves with freshly minted greenbacks [and boy is that a business which is guarded jealously ...... printing money] and then charging people for money which you and they need to spend in order to generate Industry and Intellectual Property/Product Flow is also another clanger which will crash the System ...... as sure as Eggs are eggs.

    And expecting it to work again in just the same way, with the same trough feeders at the controls, as it used to, today for tomorrow, is a most certifiable madness which the System is rotten to its Core with.

  46. Andy

    Kill yahoo

    Yahoo must die, microsoft must have total world domination, everything is easy to use, intuitive and reliable. yahoo wont even sync with outlook using imap, it has to use POP3 cmon how old is that, as for $44bn still not a lot to a company the size of microsoft now is it folks really. as for bt in bed with microsoft good thing if you ask me maybe microsoft will invest in the crap comms in the uk

  47. Ben
    Thumb Up

    Amen!.........from Mars .

    Only goes to show that those from Mars are more evolved than those from Uranus ,

    meanwhile we face a future as the "Brown" planet with he who would be "Flash" at the helm..............."Terra" indeed,stay soylent and it will all be just fine ( payments may be made by all major crunch cards , beads or even small pieces of coloured glass , just ask to speak to a Nad vice err )

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