David Andelman over at Forbes asked about my thoughts about the proposed Microsoft acquisition of Yahoo. It's rarely the case that combining two bureaucracies speeds things up, and for Yahoo to be worth Microsoft's proposed premium, there'd have to be some capability Yahoo has that the market hasn't priced in. The only thing I can think of that falls in that category is Yahoo's social DNA:
Microsoft's end-of-the-week announcement that they would pay $31 a share for Yahoo!, a premium of almost two-thirds over Thursday's closing price, has created a new parlor game in Internetland: "Is Yahoo! really worth $44 billion?" To answer that question, you have to ask, what's special about Yahoo! [...] There is one thing that is true of Yahoo! and not of its rivals--it gets social apps, and it always has. Google is an algorithm-driven company. If there is a pattern in the data from which to extract value, they have a team on it, right now, and their team is smarter than your team. Microsoft has always had the individual user at the center of its universe--though they seem to have lost that particular spot with Vista, their Office suite remains the center of most business-users' days. But only Yahoo! understands, natively, how to either build or buy applications that are designed for groups.Read the whole post at Forbes.
Leave a comment