Yahoo Acquisition: A Tug Of War Between Microsoft And Google Now


Sometimes I feel pity for Google – A company up to fight with two arch rivals and loosing grounds constantly. A side where – despite of best shot – Google+ is not taking off as expected against Facebook in social media space, Microsoft is not relaxing any grip over the OS market to accommodate Chrome OS. However, Google is not ready to give up against any of them so easily. In a recent move, Google has set the ante to poach Yahoo from Microsoft’s grip.

According to WSJ, Google is reportedly in talks with atleast two private equity firms to throw a co-finance bid to pocket Yahoo. However, the talk is in quite early stage and has not reached to a proposal level.

Yahoo’s Board of member have almost made up their mind to put it under hammer after the dramatic exit of its former CEO Carl Bartz last month. Since Microsoft is the company who is already enjoying search business deal with Yahoo, chances are quite high for Yahoo to lean towards Microsoft. Infact, in 2008, Microsoft did make an unsuccessful attempt to grab Yahoo but due to higher expectation of per share value by Yahoo stake holders, Microsoft gave it up silently. It’s been reported that, with all new equations in place, Microsoft is re-considering to bid for Yahoo with an offer which should charm Yahoo stake holders.

Unfortunately, beggar never be chooser and scenario fits here perfectly with Yahoo this time.  Unlike last time, Yahoo stake holders are not in demanding situation as company is already dwindling. I would only put my foot in mouth if Google makes an offer out of intense desperation. However, I don’t see any reason for Google to do this – atleast now.

Google Gmail is performing superbly. The market share is surging and expected to lead by 2016 as cloud based services are gaining confidence among people and especially with enterprises. If online industry earns confidence among enterprises and corporates over security issues, Gmail is expected to be the most preferred email client among all type of users leaving Outlook behind by 2016.

All above forecasts doesn’t allow Google to become desperate towards Yahoo as email and News service are the major revenue streams for Yahoo even.

Interestingly, it’s not just Google and Microsoft, Internet major AOL also has been reported to show interest in Yahoo acquisition. AOL known as combine setup with AOL will not only boost its market share but also provide an access and reach to wide audience for all other services – currently driven by AOL alone.

Trust, I am not sure what turned on Google towards Yahoo, but one think is sure – if Google grabs Yahoo, it will be just desperation rather than a perfect calculation behind !

What do you say friends. Is there some significant benefit for Google to eclipse Yahoo ?

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