Ugly Rumor Microsoft Buying Yahoo Again
The rumor mill is working overtime as Microsoft is again pursuing the acquisition of Yahoo. Reportedly $80 billion is what Yahoo thinks its value is, even though most market analysts see it more in the $50 billion range. I have seen a lot of experts saying that Microsoft won’t pull the trigger since it has invested so much into MSN over the years. The fact is this move does make a lot of sense for Microsoft.
Why Microsoft Should Buy Yahoo
If you follow my blog you know that Google is moving into the portal space that is dominated by Yahoo. While as far as portals go, MSN is second, the difference is in the millions between Yahoo users and MSN users. By users I mean people that use my.yahoo as their home page. In the bad old days of dial up, AOL was the clear champion, but times have changed and they don’t even offer Internet access anymore. Since the majority of AOL users are in the under 20 – over 50 demographic, no serious Internet user would claim to use AOL.
Now that just about everyone has high speed Internet of one type or another, everyone needs a starting place. Google knows that users that have a Yahoo home page are more inclined to do their shopping and searching there. Sure many computers come with Google search tools built into their browsers and desktop. Anyone that uses Firefox has the Google search as part of the toolbars. IE users are downloading the Google Toolbar and anyone that is involved with Internet Marketing follow Page Rank with the Google Toolbar.
Having all that power is not enough for Google. They want to be the be all – end all for users on the Internet. Their move to Universal Search, (see my article The Changing Face of Google if you don’t know what Universal Search), the upgrade from Froogle to Google Base, Personalized Search and Google Checkout are all examples of Google’s move to be your home page. Throw in Gmail and they are trying to gain all your Internet activity. They also actively gather data to make your Internet experience better.
All these things point to Google keeping their dominance in the search arena. By doing so they will further increase the value of AdWords and AdSense. That is after all how they make their money. How can Microsoft possible compete within the paid search space? The fact is they can’t. Yahoo bought Overture a while back and that put them in the driver seat as far as paid search goes. Google has the rest of the market share, there just isn’t any room for MSN or Windows Live.
Microsoft has known for years that they have dropped the ball on the Internet. They have done a poor job and they know it. While some say it is a desperate move to buy Yahoo, I think it is the only way they can have any presence to speak of on the Internet. As the Internet Presence Manger for some high profile sites I know how a company can live or die with organic search. Giving Google real competition is the best way to keep them on their toes and be more friendly to SEO. While Google preaches that they want to help Webmasters, that just isn’t so. The only way to keep Google in line is to create competition, and Yahoo can’t do it alone. Only with the vast empire of Microsoft behind them can Yahoo hope to eat into Google’s space. Only together can Microsoft and Yahoo stop Google from dominating the portal space.
Since Google started its personalized search and instituted custom home pages, I have been maintaining both Yahoo and Google home pages. The big difference is Google’s attention to blogs. The ability to easily add a blog’s feed to your Google home page is the big draw for me. If Yahoo is going to go it alone, then they must pay more attention to blogs to hope to maintain its market share of the portal space.
