So, what's on Jerry's mind. First he get's a call from Steve - informing him of the Microsoft Bid. Then he get's a call from Eric - offering to help him out of the $44B bind. Not surprisingly Eric backs down in the face of the very obvious regulatory issues which would surely consume him and his Management Team. A relative calm ensues -which lasts all of a few minutes, before Rupert, steps up and professes his interest, again.Jerry et al and Rupert have talked before but could never agree on the correct valuation for Myspace. Probably due to the fact that Social Networking Sites don't make a whole lot of money - relative to the sheer number of eyeballs they attract. Apparently, no one has figured out how to effectively monetize the Social Engagement piece -which faciliates user generated content and ultimately makes sites like Myspace and Facebook, so popular. The deal would allow Yahoo to remain independent while giving News Corp. substantial control over a huge array of Internet properties and advertising opportunities. Clearly a big win for News Corp - with very little upside for Yahoo! - so why go through with it?
The fact that this discussion is even taking place, gives an indication of the Yahoo founders feeling about selling out to Microsoft. Jerry wouldn't even consider this deal now, unless he was feeling the heat from shareholders -who have been pretty patient thus far. Let's face it - $44B is a lot of cash. So, ultimately, a sale to Microsoft still appears to the most likely scenario for Yahoo. And, apparently the MSFT Team knows it. There's no sign of anxiety in Redmond, even as Yahoo actively seeks alternatives. The company has said it is willing to "pursue all necessary steps" to consummate the deal, which could mean going directly to shareholders. Let's hope it doesn't come to that. A protracted battle, would be bad for morale at both Companies - and the only clear winner would be Google.......
