How Microsoft Googled Yahoo (Score 2)

There's been a lot of talk about how Google manipulated the FCC auction for the 700 Mhz spectrum. For a newcomer, they certainly did consumers a favor in forcing the open access provision that Verizon must now spend years trying to avoid. However, with Microsoft's withdrawal from their Yahoo bid, and the recent turn of events there should be NO misconceptions about who is the daddy of IT business manipulation.

Let's take a look at the whole MicroHoo saga from the start...

• On February 1st, 2008, Microsoft made an unsolicited bid for Yahoo. They offered $44.6 Billion which was a 62% premium above Yahoo's price of $22.97 a share.
• Yahoo goes to Time Warner, and ask them to fold AOL into Yahoo, but TW drops out of negotiations on March 5th.
• Rejected by TW, Yahoo goes to Rupert Murdoch and Newscorp, but on March 10th Yahoo is again left playing alone.
• On February 11th, after being rejected by their other potential suitors, Yahoo rejects Microsoft's bid claiming that it undervalues the company.
• After being rejected by both TW and Newscorp and turning down a Microsoft offer that is still 40% more than the total value of the company, Yahoo execs decided to http://thetechstop.net/?p=1024">reward themselves with record bonuses, giving their president, Susan Decker, a $1.1 million bonus for a job well done.
• Towards the end of March, Yahoo shocks everybody by claiming that they could http://thetechstop.net/?p=1046">double their revenue within three years.
• On April 9th, Yahoo announces that they are http://biz.yahoo.com/bw/080409/20080409006247.html?.v=1">partnering with Google to place AdSense ads within Yahoo searches. This is designed to be a limited, 2-week trial.
• All the while, Yahoo continues to claim that the Microsoft bid http://sec.gov/Archives/edgar/data/1011006/000095013408002135/f37927exv99w1.htm">dramatically undervalues their worth.
• Microsoft raises their bid to $37-a-share, or http://biz.yahoo.com/ap/080505/yahoo_fallout.html?.v=9">$47.5 Billion). They are ignored by Jerry Yang and company, so they walk away from the table.
• Fast-forward to today... Google has walked out, Yahoo stock is in the crapper, MS won't even entertain a low bid for the whole company. Jerry Wang is offering the wall-street equivalent of a BJ but the only people listening are the share holders who feel as if THEY'VE been screwed.

I wrote about this on TheTechStop.net back in May...

Let's for a moment forget that Jerry Yang is now http://online.wsj.com/article/SB120999265277067343.html?mod=yahoo_hs&ru=yahoo">getting grilled by Yahoo shareholders who think that he just lost them billions of dollars. Let's forget that they overplayed their "Poison Pill" position. The consequences of this bid battle will last for many years, assuming that Yahoo doesn't eventually fall to Microsoft for a much lower price or suffers the slow death of spinoffs and layoffs.

They will now have to make good on their 100% growth prediction. They will have to appease stock-holders who could almost taste a huge payday before it was seemingly taken away by Jerry Yang's stubbornness. They will have to shore up their battle-lines with Google even after they allowed Google into the Yahoo camp. They will be second-guessed, over-analyzed and criticized into the grave --- and Microsoft doesn't even have to lift a finger to make it all happen.

Say what you want about MS as an evil empire. Yahoo got Googled... by Microsoft.