The war goes on

On February 1st, 2008 Microsoft offered 44,6 Billion USD to buy Yahoo. The timing was right because just one day before Yahoo announced a significant profit decline (- 25 % to 206 Mio. USD in Q3 2007). The company also announced the fact, that 1000 jobs, which makes 7 % of all 14300 employees, have to be cut down.

But was that really a clever gambit of Microsoft? Is the fight against the big competitor Google not even long lost yet? This question refers to September 2006, when Yahoo offered 1 Billion USD to buy Facebook, a social network which was founded by Mark Zuckerberg in 2004. Mark rejected, but Yahoo and the other search engine providers knew, that there is a high risk of loosing many clients, if Facebook would integrate a search function, which is used by all of its members.

One year later, Microsoft bought 1,6 % of Facebook (worth 240 Mio. USD) and set the price for the company up to 15 Billion USD. If you recognise the fact, that Facebook earns 150 Million USD a year - this is quite a lot of money. The “240 Million Dollar” trick was, that now Yahoo or Google would have to pay too much for Facebook, so that this risk was “temporarily” banned. But the war between Google, Yahoo and Microsoft went on and has achieved a new height because now, Google is also interested in Yahoo.

However, its very unlikely that Google gets the surcharge because of antitrust law problems. Altogether, I think that Microsoft will get the company, which leads to an exciting showdown between Google and Microsoft.