If MicroHoo/YahooSoft is Inevitable, Then What?
by Todd Ogasawara
Microsoft's Director of their Open Source Software Lab told us...
Why I’m excited about Yahoo!
...in a Port 25 blog entry. Sam's comments are very positive and his excitement is understandable. Here's my take on MicroHoo/YahooSoft.
The Feds and the EU approved Google to acquire Doubleclick. So, Microsoft and Yahoo should get through that hoop too. Yahoo (YHOO) is not only underperforming compared to Google (GOOG) and Apple (AAPL), it is also underperforming compared to the NASDAQ index. I found it kind of interesting that Microsoft and the NASDAQ tracked each other nearly perfectly over the past two years too. The chart is from Yahoo Finance, btw. I really like its charting features.
I think the acquisition is inevitable for the simple reason that Yahoo's major investors must be pretty restless given what looks to my financially untrained eye as a two-year loss of market cap only broken when Microsoft made the move to acquire it. But hey, I don't claim to be a financial expert or to see into the future.
Yahoo has a lot of good stuff and good people that aren't reflected in their awful market performance. And, it would be interesting, as Sam implies, if those people stay on after the acquisition. But, having been one of many peons involved in a past mega-merger, I'm not so sure the Yahoo superstars will hang around long enough for the acqusition to close. That's too bad, because I think the addition of Yahoo's Open Source superstars to places like the Microsoft Open Source Labs might really ignite Microsoft's detente with Open Source and turn it into a really productive path for Microsoft. And, yes, I can see some of your raising your eyes to the air and saying this is all this detente stuff is pretense on Microsoft's part. I felt exactly the same way when I heard that Microsoft had an Open Source Lab a few years ago. I felt for sure it must be some kind of propoganda FUD team. But, I decided to visit there while on vacation and was able to meet and speak with Bill Hilf (the Director of the Labs at the time). I visited the Labs again last year (again while in the area on vacation) and met with more of the team. Guess what? I think these people are sincere in their efforts to get Microsoft and Open Source people and projects together.
I think it would be really interesting to see a huge influx of Open Source and web talent come in from Yahoo and, potentially, make a sea change there. Time will tell.
I see this merger as a huge technology nightmare for MS. Do they let Yahoo! carry on as they have? Or do they force them to rip out and replace their FreeBSD/MySQL/Apache infrastructure and replace it with IIS?