Microsoft Buying Yahoo? No Way

    May 24, 2007
    WebProNews Staff

They don’t need Yahoo and they don’t want Yahoo up in Redmond. Microsoft can compete just fine with Google without Yahoo.

Microsoft Buying Yahoo? No Way
Microsoft Buying Yahoo? No Way
Microsoft Buying Yahoo? No Way

We’ll give you a moment to stop laughing and get back in your chair. Better now? Good. Because when it comes to fighting the search and advertising battle, Microsoft has Microsoft’s back.

It’s not that the two companies haven’t talked about doing more together, up to and including a potential merger. Yahoo was Microsoft’s search and ad supplier on MSN for quite some time, so there is some history present.

Yusuf Mehdi, Microsoft’s chief advertising strategist, said in Las Vegas at a Goldman Sachs conference that a Yahoo deal would be unnecessary. Paul Thurott picked up on Mehdi’s dismissal of a Yahoo buy:

“From where we are today, I think we have all the pieces.” Mehdi said, noting that the two companies will continue to work together in some ways even as they compete in others. For example, Microsoft and Yahoo ensure that their instant messaging systems interoperate, he said.

Some have noted that Yahoo’s valuation, up around the $50 billion mark, puts it out of Microsoft’s price range. That’s assuming Microsoft would only pay cash for the deal. If they wanted to do that and take on some debt, it seems likely Microsoft could have financing lined up by the end of the day.

Despite Microsoft’s reputed weaknesses in the search and online ad market, they still pull in a lot of cash every quarter from Windows and Office. Bankers would be quite willing to consider that in putting up the cash to help make a Yahoo acquisition happen.