The Microsoft conference call on the Yahoo bid is happening now. I’ll live blog rough notes. Greg Sterling will do a formal write-up later.
- Had conversations over past 18 months.
- Called Jerry Yang to discuss yesterday
- Online advertising is growing
- Scale economics helps
- Technology matters in the space
- Because of both, there’s consolidation
- One player dominates (Google; he doesn’t say that)
- Combining will give a more "credible" competitor
- Combining talent pools, two search indexes, two ad platforms
- Will enhance user experiences, innovation, better value for customers (see FTC, consumers win!)
- Combining search and non-search in a single platform will improve revenues, make life easier for everyone
- Pluses in eliminating redundant jobs and efforts, the fourth synergy in all this
- Have a clear integration plan (can’t wait to hear it)
- Based on success integrating aQuantive and TellMe (neither of which approach an integration of the size of Yahoo)
- Portals led the way (think he said that, and if so, they didn’t)
- Search becomes important
- Search will grow past 10 blue links (thank Ask’s Jim Lanzone for popularizing this notion)
- Natural language will come (yeah, right)
- Yahoo has great community assets, combined with Microsoft productivity apps and devices, things will be great
- So excited!
- Restates offer terms, says second half of 2008, hope to close
- Real opportunity is long term values
- To Ballmer, why this after aQuantive. No consumer face to that. No better
way to increase scale and capacity than this.
- Johnson reiterates that scale matters, you can ramp up ads if search,
non-search, behavioral all on the same platform.
- What makes this a more competitive offer than other potential media buyers
that might be out there? Liddell: believe it’s an attractive one.
Smith says that since Google has 75 percent marketshare worldwide on paid
search, they aren’t in a position to do this, anti-trust laws would prevent
- How do you stop Yahoo from losing marketshare, asks analyst (dude, Yahoo
isn’t — Microsoft is). Kevin comes back to combining engineering to be more
efficient and drive core relevancy (which Yahoo is already competitive with in
terms of Google, so that’s not a convincing answer).
- Why not expand R&D rather than integrate two companies with different
cultures? Is that risk accounted for. Ballmer — nothing like putting together
two larger sophisticated R&D operations (or a nightmare). "It should be quite
an accelerant." (or a hindrance, could go either way).
- Hoping I’ll get to ask which brand will survive in search, which ad
platform will make it, and more actual details on this plan. Damn, last
- Ah, asked about existing brands. The Yahoo brand is a great brand. We love the Yahoo brand. They want to have clear integration principals and leaders from both company and lots of synergy (and corporate feel good talk). Ballmer: the Windows user wants to be live. There will be a Windows Live (’cause the demand has proven how much that’s been demanded so far, not). We have some thoughts… but a team from both companies would be best to assess that.
End of call.
Bottom line. There’s a plan Microsoft has in mind, but it sounds like it has to be developed a lot more, especially when Microsoft itself says it doesn’t have answers until it works with Yahoo. Frankly, this sounds far from an easy win for Microsoft, especially after having now put Yahoo into play, there are good arguments it could stay a strong company and not suffer brand confusion. But there are compelling reason, obviously, why the two combined would be the best challenger to Google.
For more on the Microsoft bid for Yahoo, also see our other coverage:
- Microsoft Makes $45 Billion Bid To Buy Yahoo
- Microsoft Call: "We Love The Yahoo Brand" [But Can The Deal Happen?]
- MSFT + YHOO: What Would Microsoft Yahoo Look Like?
- Q&A With Microsoft On Proposed Yahoo Purchase: 2+2 = #1
- Microsoft + Yahoo: Recapping Reactions