As Yahoo’s stock continues to tank, Steve Ballmer and Carol Bartz are trying a bunch of new communications strategies to try to dampen disgust at the Yahoo-Microsoft search deal:
- You don’t get it. At Microsoft’s analyst day yesterday, Steve trotted out this usual fallback response to panned management plans. Unfortunately, there’s another possibility: People do get it. They just don’t like it.
- Yes, the deal “is a little bit complicated.” Steve tried to soften the insult implicit in the above by suggesting that the reason everyone “doesn’t get it” is not just that they’re a bunch of morons. Given that the deal will take two years to implement, involve enormous systems and salesforce integration, and undergo heavy regulatory scrutiny, this is also a “little bit” of an understatement.
- This is what I meant by “boatloads of money.” Carol tries to explain that a straight revenue share at lower-than-usual industry splits (for a deal this size) was what she meant when she explained how much it would take to get her to do a deal like this. Observers can presumably be forgiven for wondering what happened to the $1 billion Microsoft was ready to hand over last summer.
It’s always possible that Steve is right, that people don’t get it. More likely, however, the market is accurately perceiving that:
- Yahoo got taken to the cleaners.
- The deal is likely to be a regulatory, management, and logistical nightmare.
- Microsoft’s financial performance will barely improve even if the deal is a success.
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