Channel Marker

May 7 2008   9:27AM GMT

Microsoft and Yahoo: Dumb and dumber

badarrow Barbara Darrow Profile: badarrow

After reading about a gagillion articles on the Microhoo meltdown, the big mystery remains. (The only more popular topic in my household is the Roger Clemens death spiral, but it’s a close call.)

Is Steve Ballmer a diabolical genius who pushed Yahoo away only to end up getting it in the end? For less dough? Don’t kid yourself: That could still happen.

Proponents of this theory cite how BEA Systems crawled back to Oracle in the end. Although not for appreciably less money than Oracle was offering

Or did Ballmer waver, Hamlet like, and merely end up looking foolish?

One Microsoft insider put it this way: If you talk about an unsolicited bid (which Ballmer did) and hint about a hostile takeover (which Ballmer did) you’d better be prepared to go for the gusto (to quote the great Ballmer himself). And that means if the difference between you and them is a measly couple of dollars among the tens of billions already on the table, then GO FOR THE GUSTO!

But, face it: As for looking foolish, Steve B. may have some egg on his face, but Jerry Yang got the whole omelet. It stretches credulity to think that Yang did not KNOW the offer had been raised to $33 as has been reported. And institutional shareholders are out for blood. Yang will probably spend what’s left of his reign in full damage control mode.

In any case, as a former Microsoft exec said the other day: The only winner here is (guess who?)


“You’ve got the number 2 and 3 search guys battling it out tooth and nail and Google gets to sail along,” he said. (As a Microsoft shareholder, btw, he is not happy about this.)

Added bonus for Google: It gets to play the role of white knight to its number one rival and can act as savior to the whole Silicon Valley culture which has been dying to knock Microsoft off its perch.

So, maybe Google is the new Microsoft. I don’t throw that phrase around lightly seeing as how some remember when Borland was going to be the new Microsoft. Didn’t happen.

It’s not that Google has more money than … well, more money than Microsoft (which it might); it’s that Google is now blessed with a  rivals who are obsessed with beating it at all costs, that those rivals now end up with omelets on their faces.

Microsoft’s worst nightmare is not that it is the new IBM. It is that it may become the new Lotus.

Barbara Darrow can be reached at

 Comment on this Post

There was an error processing your information. Please try again later.
Thanks. We'll let you know when a new response is added.
Send me notifications when other members comment.

Forgot Password

No problem! Submit your e-mail address below. We'll send you an e-mail containing your password.

Your password has been sent to:

Share this item with your network: