Microsoft Continues To Court Yahoo!
Monday, May 12th, 2008Microsoft, the world’s biggest software maker is so much in love with Yahoo that it seems to be paving the way for a takeover of Yahoo.
It is common knowledge that Steve Ballmer, the chief executive office at Microsoft gave Yahoo a deadline to accept their $44.6 billion bid; however they Yahoo was not keen on going through with the deal and had not responded to Microsoft.
Microsoft is weighing the two options left for them – to let go or begin a hostile takeover battle. If they decide on fighting the crucial point is what they are going to offer the shareholders, whether they are going to stick to the original bid or increase the bid to win the shareholders over.
Microsoft has been looking to gain more foothold of the internet advertising market, with more searches, sell advertisements with more videos and graphics, and this is currently dominated by Google. The only way they can do this with the help of Yahoo and this is the reason Microsoft just cannot afford to let Yahoo go.
Having spent a billion dollars creating a web search engine and technology to sell ads, buying internet companies such as Yahoo and AQuantive would give Microsoft the prestigious No.2 spot in the $41 billion online ad market.
If we compare Google and Microsoft, while Microsoft faced losses of $228 million at Redmond, which is Microsoft’s Washington based internet business with sales of $843 million; Google, owner of the most used internet search engine had $3.7 billion in revenue, excluding the sales passed on to partner sites.
Google is much ahead of them because internet is all about advertising, and advertising linked to search results accounts for more than half of internet ad sales. According to researcher ComScore, Google handled six times more queries in the US in March than Microsoft. (more…)