Microsoft Conference Call On Yahoo Deal
Ballmer said the offer is a great opportunity for Yahoo employees.
Making it public today allows everyone to consider the merits of the offer.
Kevin Johnson speaking now: discussing MS gains in online advertising and other products, touting necessary investment and other dynamics.
He cited one company as the dominant player. Doesn’t name names. I think I can guess this one.
KJ discussing synergies in various areas like mobile. Elimination of duplicate services, especially by combining ad products, key to making big bucks.
Integration plan to include leaders from both companies, citing aQuantive and TellMe acquisitions as examples.
Ray Ozzie speaking, noting importance of search to online users.
"Social platform will become a new entry point" he noted. Called Yahoo pioneers, "we can further accelerate the transformation to a more social web."
Looks forward to extending Yahoo Dev Network to more developers.
Chris Liddell: recapping the money, $44.6 billion, combination of cash & stock, would like to close deal by second half of ’08. I’m sure they would like to do that.
He mentioned the value of Yahoo’s non-core businesses. Break-even should happen quickly if deal goes through.
Sanford Bernstein asking Ballmer about making a large deal like this. Ballmer sees need to build critical mass with consumers, advertisers, and publishers. "No better way to increase scale than this acquisition."
UBS asking about revenue synergies. Johnson reiterating scale matters in advertising. "Scale economics can kick in fairly rapidly."
Goldman Sachs: any thoughts on this becoming a more competitive acquistion, or a final price. Liddell says MS thinks the deal is attractive right now. Brad Smith said MS has made a compelling offer, noted how potential media acquirers have encouraged this deal. He ruled out Google as a possible buyer due to their super-dominant market share and antitrust laws.
JP Morgan to Kevin Johnson on Yahoo losing search market share: How can Microsoft stop loss of share? R&D synergy mentioned again. (Don’t do a shot every time they say synergy, you’ll be comatose – David)
Bear Stearns asked why not just expand R&D instead of trying to integrate two vastly different cultures, did MS account for risk? Continuing market growth and consolidation at the top motivated this Yahoo offer. "A good integration should be an accelerant to progress."
Final question on integration, MS wants joint management team to work through the process and synergies (there’s that word again). Ballmer said software plus services is really a transformation of our business. There will be a Windows Live Office says Ballmer. This deal does not put any other potential activity by MS on hold.