Breaking News: Microsoft Bids $44.6bn for Yahoo!

Everton | Feb 01, 2008 | Comments


I’m stunned by the breaking story my boss has sent me that Microsoft have just bid $44.6bn for Yahoo! The price is 62% above Yahoo’s closing share price on Thursday, so it’s going to be a hard one for Yahoo’s shareholders to reject.

If the deal goes ahead it will be the biggest internet tech takeover, and one of the biggest takeovers in American corporate history.  Microsoft added that it did not believe there would be major regulatory hurdles.

Steve Ballmer, the chief executive of Microsoft, said:

“We have great respect for Yahoo!, and together we can offer an increasingly exciting set of solutions for consumers, publishers and advertisers while becoming better positioned to compete in the online services market.”

Combining Yahoo and Microsoft’s online forces will give Google a serious run for their money. I’m still trying to come to terms with the story! I’ll write more once I’ve had a real chance to think about the implications. Any early thoughts?


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About the Author: Everton is based in London and has worked in the internet and mobile space for over ten years now, and before that worked in corporate strategy and consulting. He has a degree in Economics from Cambridge University.He also writes for Windows 7 News, Windows 8 News and One Tip A Day.

  • From my point of view. MS is not planning to drive search Engine traffic from yahoo, but its trying to use the good traffic with its advertising strategy. Speaking about Yahoo, its not a search engine company, as you people speak about the number of visitors it drives into your site. Might be MS has a mega plan to combine all the services into live.com and make live as a better place. :) Ofcourse their plan would be to earn more money from their advertisers.
  • I think it's an interesting move by Microsoft. But I still don't think they could ever touch Google's dominance. In the Netherlands Google holds a market share of 94%.

    MSN, or Live Search, only has some market share, because they implement it in every single application.

    But maybe it will cause some nice competition in the rest of the world!
  • Oh, and live.com follows yahoo's traffic type, with 77% in mail, and 2% in search (as does msn).

    So, while all these sites are big, they all primarily trafficed by mail users.

    Google will still dominate them in search traffic by 6x which is a lot of ground to catch up. Though, I daresay it will probably be profitable in mail ads alone, especially since they are the ones brokering the ads (unlike the facebook/msn deal where msn takes 40% off the top)
  • You are correct in that referrals from yahoo are soo small compared to google, even if you add in MS, it doesnt add up.

    stats (rounded):
    google 13,000
    yahoo 800
    live 700
    msn 400

    however, according to alexa (yes there are issues, but on a scale this big it becomes more accurate) yahoo and google are neck and neck and add in live/msn and you are easily on top in terms of largest ad generating space on the web ;)Ive always wondered how yahoo could keep so close to google on alexa.. seemed strange to me.. maybe yahoo mail, and some of the non search properties are really quite big.

    oh, check this out
    Where people go on Yahoo.com:
    mail.yahoo.com 46%
    search.yahoo.com 14%

    which would explain why we get no referrals, but the site is still enormous.

    google on the other hand is flipped
    google.com (search) 59%
    mail.google.com 19%

    Interesting, eh?
  • ps.
    I'm getting first page serps on Yahoo as well as Google.
  • How many people a day does Yahoo send you? Google?

    Maybe it's me, but my site and my friend JD's site get a flood of people from Google, but only a handful of people from Yahoo and Live. Maybe Google has the market on educated, affluent people with money to burn on luxury items.

    If Yahoo gets more search traffic than Google, tell me what I'm doing wrong, because on a day Google sends me 600 people, I'll get 16 from Yahoo.
  • Taps for Google...???

    @mlankton - where are you getting your stats? According to the stuff I'm looking at Google trades places up & down with Yahoo, and MSN is about two-thirds the volume of both of them - the way I see it this would dominate Google by about 30% - 35%

    Really interesting move by Microsoft (not saying this is a good thing, just interesting...)
  • MSN and Yahoo account for a pretty small percentage of search engine users compared to Google. Is Microsoft so interested in Yahoo's portal that they think it's worth that much? It is still the most trafficked site on the web, but $44B?
  • OMG
    google s position as search engine master will be challenged

    if that happens have to switch to some chinese search engine (baidu or whatever) instead of MSN
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