We spoke with a senior executive at Microsoft about several issues concerning the Yahoo bid. Here’s the inside take:
Jerry Yang’s initial reaction to Steve Ballmer’s call last night?
- Polite. He obviously has to consider it.
Will AT&T or Google try to make a play?
- AT&T encouraged us to make the bid. They have no interest in buying Yahoo themselves.
[Earlier, on the conference call, Microsoft counsel Brad Smith suggested that Google wouldn’t have a chance of getting the deal through anti-trust. We’re not sure this is true–Google could argue persuasively that the future of this industry is about more than “search” and that Microsoft is in a strong position–but, for other reasons, we don’t think Google will make a play here.]
How can you keep Yahoo employees motivated/retained? How can you compete with companies that can offer stock options that are just tied to Internet-division performance?
- We’re going to offer big up-front retention packages, and we’re going to do it right away. We especially want to keep Yahoo’s engineers.
- At Microsoft, divisions are rewarded based on both divisional and corporate performance, so if the division does well, employees will see a direct benefit from that.
- This is a hot area for tech talent to work in, and there are very few places where engineers can compete on a global platform in this arena. It’s a great playground and platform.
Will “Yahoo” become Microsoft’s dominant Internet brand? In the past, your brand confusion has been dizzying, so this seems like an excellent opportunity.
- Yes, Yahoo has a great consumer brand [much better than any Microsoft Internet brands]
- This is indeed an opportunity for us to consolidate/clean up our many brands and offerings.
- No decision yet on whether we’ll consolidate under the Yahoo brand. We’ll obviously look at this carefully.
What has to happen for deal to go through?
- Yahoo has to agree to engage [and then need regulatory approval].
- Once we have that, we can close in a weekend. We know the company very well. No need for extensive due diligence
MORE ANALYSIS of MICROSOFT FOR YAHOO:
Complete Coverage: Microsoft’s Bid For Yahoo!
Bidding War for Yahoo? We Doubt It
Microsoft Conference Call: No colour on Yahoo Reaction
Analysis of Microsoft Bid for Yahoo: Brilliant Move, Deal Going Through
Micro-Hoo: Combined Financial Performance (including cost synergies)
Microsoft Letter to Yahoo Board
Microsoft Wants to Buy Yahoo Again
How to Structure a Microsoft-Yahoo Deal
One Problem With a Microsoft-Yahoo Deal: MSN is Only Worth $10 Billion
Proof that Microsoft Plans to Buy Yahoo?
Playing the AOL-Yahoo-Microsoft Chess Game
Why Microsoft Needs to Buy Yahoo:
MSN: Still Sucking Wind After All These Years
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