Op-Ed: Microsoft and Yahoo! News and views, but not a lot of schmooze

Buy an ad on DigitalJournal.com

Looming large across the horizons of both companies is Google, which is taking Godzilla-size bites of their markets. There’s a sort of internet folklore which says that Microsoft and Yahoo! need each other, because individually neither of them is a match for Google.

All the media version of the actual takeover needs is a rancher’s daughter wearing the Yahoo! logo, the deeds to the ranch, and some Microsoft executive with a pencil mustache leering at her.

Melodrama aplenty, and of course the Microsoft-haters and Yahoo!-sneerers as commentators. Like so many major business issues, reality rarely rates a mention.

In this case, however, the bottom line is obvious to everyone.

Google is the problem.

It’s a pretty big problem, because since inception it’s left both Microsoft and Yahoo! flatfooted. From nothing to super-stupendous-gigantic-colossal, and look where the market went.

Yahoo, however, obviously has some pride. Adopting anything that suits its purpose, a barrage of Yahoo-positive articles has emerged on Yahoo’s news page.

These headlines say so much:

Microsoft Talks Tough, But Earnings Show Weakness (New York Times)

Earnings show Microsoft needs Yahoo (Business Week)

Bearing in mind there’s a few billion of equity involved, a lot of investors, and some healthy profits to be made, this media spiel has all the heart rending sincerity of a health policy.

But there's a real lack of schmooze, no sweeteners. That's sort of strange, given the kind of money which could be flying around if the deal goes through. Yahoo! isn't acting like it's a buyer's market, which is understandable, but if Microsoft does mount a hostile bid, "hostile" will be the operative word.

Microsoft has been playing tough, yes. But exactly how many billion do you want to throw at anything, before you decide you don’t want to throw any more?

This is supposed to be a business deal, not a charity auction.

Yahoo does have intrinsic value, undeniably, but you’re talking about something very like a 30% increase in the offer price.

Like an extra $15 billion dollars.

That extra $15 billion could buy an awful lot of inflatable friends, and other domestic appliances.

Some of it could even be diverted to an operating system that doesn’t drive customers insane.

To give credit to Yahoo, they also featured this story by Kara Swisher, a pointy piece called Memo To Yahoo: Incoming-Duck and Cover

Ms Swisher, writing before the Microsoft earnings were released, said that if Microsoft boss Ballmer is all in favor or the Yahoo deal, others aren’t. It’s not a foregone conclusion that Microsoft will stay in the game. She also pointed out the money could go elsewhere.

Microsoft has in fact said exactly that, recently. The “more money” approach from Yahoo hasn’t gone down too well, apparently.

I don’t know why, but the image of a Daffy Duck cartoon keeps flashing before my eyes as I write this.

Scene: Daffy as Pocahontas, Porky as very unwilling Capt. John Smith.

Daffy: Papa! Not kill Captain John Smith! Me marry! Raise little Poker Chips!

Hmmmm….?