Microsoft and Yahoo working on $20 billion deal

Microsoft is once again in talks with Yahoo to acquire its search business for $20 billion according to reports from The Times.

The deal comes after two previously failed Microsoft attempts to take over all of Yahoo. Also, Microsoft would support a Yahoo management team with $5 billion. This would be used to fill in several empty positions on Yahoo's team, such as the CEO position Jerry Yang left recently.

The deal would bolster Microsoft's search presence, which has been lacking. Microsoft has also been rumored to be rebranding "Live Search" into "Kumo". After news of this meeting, it is rumored that Kumo will be a mixture of Yahoo and Live Search into one. The deal comes as a saviour to Yahoo also - it is estimated that Yahoo will benefit $2 billion per year under the new deal.

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31 Comments

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hah this'll be the lol of the centry here in nz as up untill last yr ms were partnered with telecom/xtra known as xtramsn.co.nz well ms wated more services to be available but telecom said sod off we aren't going increase our server capacity just for your junk so ms once again run there own servers here in nz and guess who now partners with telecom/xtra yup you guessed it and its now known as yahoo.xtra.co.nz anyone for what the next name will be
maybe something like msn.yahoo.xtra.co.nz oh forgot to say this telecom/xtra are the main telco and isp here

There could be some truth to this. Its always just as easy to spin news on this (insider) to gain an advantage. Stock manipulation, taking down the competition, getting the shareholders on board. Or its someone speculating on the whole matter ... and might not even be right.

IMO whatever is the truth, I just hope all the Yahoo employees keep their jobs.

what ever happens google will still be the top search. microsoft just want to be in the top 5. but everything microsoft buy dies. look what happened to multimap.

After I thought about it a bit more 20 billion just for the search part is far to much, 25 billion yahoo as a whole would be a generous deal. I think Microsoft should be looking into AOL and FaceBook as well.

There's no official statement from MS or Yahoo about this yet right? So it seems just to be a rumor.

I don't see the need for MS to keep or even use many of Yahoos services that MS does right now anyways, the new Live Wave 3 stuff is very nice and very interesting.

That aside, Search is where Live is a little weak, though everytime I use it I find what i'm looking for, so no problems there.

Aside from search Yahoo has 2, maybe 3 other sites/services that are worth a dime, the rest just loses cash which is how they got into this whole mess in the first place.

for 20 billions, microsoft should invest that on other stuff, they can make a better search engine than yahoo.... if they can.

The rest of Yahoo would still be run by their current management like it right now. The only diff would be that the search is taken off their hands in exchange for a fixed cash revenue.

Should be intresting to see how there stocks react to this news... i say $20 or so easy... Guess we all know why Icann was buying a **** load more shares now..

I hate companies that have to rely on buying other companies to make themselves known/better. Use that money instead to make your product better than the competetors and guess what? You might do better! All the big companies seem to do it. Just seems like lazy to me. Oh well, I don't use either service anyways. Use to use Yahoo!, but Google always seemed to give me better results or I would have stayed with Yahoo!.
Rest well Yahoo!

Google also has bought a lot...

I do not hate Microsoft for buying Yahoo, considering it's gonna be better than their Live service. The point is, Microsoft is probably gonna do a better job with Yahoo than Yahoo did to itself.

Glendi said,
Google also has bought a lot...

I do not hate Microsoft for buying Yahoo, considering it's gonna be better than their Live service. The point is, Microsoft is probably gonna do a better job with Yahoo than Yahoo did to itself.

Google's bought YouTube, Picasa, Android, AOL (5%), etc.

I didn't know about Android or AOL...lol But I did know about Youtube. I might not agree with what the do, but I still do use them. Just like I do use Windows.

Either you just want to jump on the nice hate MS bandwagon or you don't understand the real world...

You can't always innovate a solution better than a competitor or to do so would cost considerably more than buying the competitor...

What you are saying is equiv. to saying why buy any product at all? Why don't we all just build our own?

Frazell Thomas said,
Either you just want to jump on the nice hate MS bandwagon or you don't understand the real world...

You can't always innovate a solution better than a competitor or to do so would cost considerably more than buying the competitor...

What you are saying is equiv. to saying why buy any product at all? Why don't we all just build our own?

To bolster your comment further: if we build our own product, they would say we copied it.

This rumor sounds a little too farfetched. While they could be having talks, the price tag and terms of this deal seem pretty iffy. Yahoo as a whole company is worth less than $20B on the market and Microsoft's previous search deal was only worth half of this one. Why would MS be looking at something this expensive, especially in these economic conditions?

EverReddy said,
Why would MS be looking at something this expensive, especially in these economic conditions?

Especially if you consider the additional costs of converting Yahoo's BSD equipment to Windows.