What happens if Microsoft buys Yahoo?

One's head spins thinking about Microsoft's unsolicited bid of $44.6 billion for Yahoo.

Yahoo has been a major figure in the open source world for a long time. It sponsors events, participates in countless development projects, and encourages its own engineers to do open source work. And, of course, it uses countless open source code bases as well.

Now comes Steve Ballmer, who says in a statement, "We have great respect for Yahoo, and together we can offer an increasingly exciting set of solutions for consumers, publishers and advertisers while becoming better positioned to compete in the online services market", and "We believe our combination will deliver superior value to our respective shareholders and better choice and innovation to our customers and industry partners".

Corporate blather, of course. The NY Times story behind that first link plays the whole thing as vendor sports: Microsoft + Yahoo vs. Google. But there's far more in play than advertising budgets and shareholder value. Tweets Paul Downey, "Bad news for numerous Open Source projects: YUI, PHP, FreeBSD, Squid, gSOAP, Hadoop, etc. They'll survive, but my moral compass is spinning".

I have thoughts along the same lines, but I'd rather hear yours first, and respond down in the comments section.

So what do you think? What will happen if Microsoft buys Yahoo?


Doc Searls is the Editor in Chief of Linux Journal


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In my opinion Bing have

tony rung's picture

In my opinion Bing have potential to fight with google in search engine market... yahoo search is awful. but they have a strength in web content. that's fine combination.

What happens if Microsoft buys Yahoo?

Spunky Jones Ethical SEO's picture

I am not sure what will happen, but would be interesting to see what happens. I am wondering why they would want to buy Yahoo, when they could pump the 44 billion into their new bing.com directory and hopefully kill Google, or at least put a major dent in it?

What happen if Microsoft buys yahoo!

Alan Williams's picture

Microsoft can gain a good market in search engine in the competition with the repsect to their competitors.Microsoft have been thriving hard to gain the yahoo but i don't think the deal has come to an end till now.

The deal is on the plate again

storage containers's picture

This time Yahoo is really in trouble and Balmer is thinking about re considering the deal. I think that we really need a microsoft yahoo deal to compete with Google. I'm sorry competition is great because it forces someone to make things better like the whole portable storage issue with skydrive a while back and how google's gdrive is almost non existant.

What happen if Microsoft buys yahoo!

Umer Insuran's picture

I think this issue is closeed now.
but I like to say it is not a wild bid that Microsoft put in.
but it is a really calculated bid but yahoo don't take it seriously.

Hope that Yahoo and the Open Source wins!

Martin's picture

First of all I hope (if Microsoft buying Yahoo) that Microsoft will continue on their line of opening up their program code. I even hope that when they need to choose between their products I hope that they choose Yahoo's! Yahoo's search-engine, Yahoo's mailaccount and so on.

Microsoft injects $20

Anon's picture

Microsoft injects $20 billion of liquidity into the market, that's good for my IRA.

Some news stories say that the $20 billion represents all of their cash. Didn't MS have $50 billion on hand recently? What happened to the difference? What happens to their cash flow if they spend all their mad money on Son of Hotmail?

My main concern is the Windows Update site. I'm responsible for a mere 11 XP computers, but for even this tiny network I find Update increasingly unavailable, sometimes for 3 or 4 days. I imagine XP would be pretty well trashed if it went 6 months without an update; MS not having the resources to keep Update going is an unpleasant prospect.

Not Good

Affiliate Marketing Guide's picture

It may be that we are seeing the slow death of Yahoo. Which does not have to be. When they took the keyword suggestion tool offline, which is probably Yahoo's most popular feature with online marketers, something was up. The problem is while Google has managed to monetize itself using the extremely successful adwords program, Yahoo search marketing does not seem to have been nearly as succesful. It is rumoured that they will soon adopt Googles landing page relevance and ad performance stance.

I suppose if a buy out by Microsoft will give Yahoo the injection of cash it needs perhaps they may not have an option.

It would take Yahoo from it's more socialist image towards a more capitalist approach to business.


Affiliate Marketing Tips


Ann O. Numous's picture

Vote Democratic. The republicans have ruined our country

right on

Anonymous's picture

Right on brutha

Single sign-on, Passport II

Burz's picture

Otherwise known as 'CardSpace'. It works off of Active Directory, and they are already putting this logon system into Facebook. Microsoft's Kim Cameron says a Passport-like system is necessary because "SSL is insecure" (mega bold-faced FUD there). I even challenged him to provide examples or reports about this supposed Https/SSL insecurity and he wouldn't name any. (see comments)

Of course, what this means is that eventually Active Directory will become the defacto standard for logging into websites even if the latter are Unix-based. I doubt Samba would work smoothly with CardSpace/Passport, as would most sysadmins who would deploy Microsoft's products just to ensure that all those Windows clients wouldn't encounter sign-on snags.

The bumpy authentication ride that non-MS systems encounter on the corporate LAN is about to be moved to the wider Internet.

All because MS moved the sign-on process from the browser to the OS... THEIR OS... using the combined influence of their MSN, Facebook and Yahoo! properties.

This is extra saaawweeeeeeett

Thaudit's picture

I love this news. MS is just being consistent with capitalism. Concerns of monopolization are foolish b/c it is just the logical end of our financial system.

Just think, no more worries of unknown, smelly open source attempts at "killing" exchange or the like. No more stupid acrostics. YUI, PHP(this one has merit though) , FreeBSD, Squid, gSOAP(huh?), Hadoop
(me thinks this will die)

Go MS go. you set out to rule the technological world, you go boy.
I see google going down in an Ichabod way. Their too earthy to last very long anyway.

MS on the other hand is acceptably pervasive in all corporations above 4 Birkenstock wearing staff.
Fantastic tools like SQL Server, VS 2008(.net has no peer) , EXCHANGE 2007 (this is the staple) deserve recognition of being 3 of the greatest technological tools of the computing industry.
This will also encouragingly put apple where it does its best work, namely just i(Gadget) and i(media) Leopard does have a bit of merit though if your life consists of chiefly picture and clip mgmt.
THanks for listening.

MS 4 ever. Open Source when it become corporately acceptable. (Secretary Josey Smith must be able to use it like her home MS XP machine) Until then table the whole momentum.

What happens if M$ buys Yahoo

bradslinux's picture

Probably very little good....perhaps even a bit of bad. Namely, Yahoo being sent down the same swirl hole that
Vista is spinning in. FLUSH!!!

reminds me of patent fervor

cpuspeed's picture

The only thing that gives microsoft any credence is our reaction. Really... who cares. Microsoft has missed the boat on so many computer fronts its not worth the bother anymore. A dead company going nowhere. Theyre like a dying dinosaur sinking in a tar pit grasping at tree branches. Buy whatever you want, it wont help. Like a middle aged man buying an expensive sports car. Youre still bald and an idiot. But there comes a time when people simply dont care anymore.

From the "Official Google Blog"

Anonymous's picture

Yahoo's openness asset

Doc Searls's picture

Rather than comment here, I put up a whole new post on the subject.

Doc Searls is the Editor in Chief of Linux Journal

I've closed down my yahoo

cloid's picture

I've closed down my yahoo mail account already, if people feel negatively about this proposed merger I'd suggest people vote with there virtual feet and do the same. close flickr accounts, mail accounts ect.

ms have a significant market share in free email already, combine that with yahoo and it's pretty dominant.

again, just dont use their services if this goes though. I carnt fathom how this all would work out considering yahoo are vocal supporters of open source projects and their extensive use of bsd.

A lot of money gets free - possibly

ebirdie's picture

First it depends how the buy is arranged, whether there is real money exchanged or some other forms of trade value. If it is real money, then it is away from MS's pocket and in others pockets from where it may find new ways to Open Source projects, what is good. Also this is a sign of strength of Open Source technology again. Just imagine if Yahoo were built on proprietary technologies of its own and others. A lot of intelligence and trade were lost in the buyout.

Anyway it is good that the amount is big, even for Microsoft, and it will get to the hands of other people, who may not share Microsoft's values, visions and strategy. The hope is that the money empowers different people willing to start up new services with Open Source technology. But the amount is so big that I highly suspect that all of it won't be in free flowing money but in some other forms of value with strings on it. That lessens the empowering factor considerably and plays for Microsoft as well, when the people won't get loose with all the money.

For net service business the buyout will make two steps backwards. It is very propable that Yahoo will be another form of dot Mac and will be found inside Vista with some extension and twist, which may lessen usability in minority of user base. There is a lot of those users, who don't care a bit, if Microsoft owns the services and pushes its products and technologies through the net service channel, like Apple does with iTunes and iPods. The model has already been proven succeful.

What brings me to conclusion that Open Source technology and net does not alone produce free services. The free net services are bought by big players for their purposes when time is ready. With the free service I mean a service free from extensions and policies to push and lock in users to another product (OS, music, mediaplayer, whatever).

So this is another kind of problem of trustworthy in a free net service whether it can be a place to keep your photos in or in a hard drive at home or printed in books. As there are concerns expressed in the comments. Your photos, blogs and all your content in Web 2.0 services will get into the battle field of corporate market share and market dominance.

Buyout Money

Anonymous's picture

I think I heard on CNBC that MS would buy all outstansing shares of stock.

Any business takeover experts reading this blog may want to explain the implications of this further...

What happens if Microsoft buys Yahoo

Kobe's picture

I used my moral compass on Yahoo a long time ago, I had my business email with them, but after they gave up the emails of the pro democracy Chinese fellow to the Chinese government, and now he is rotting in a nice Chinese jail, it turned my stomach, Yahoo has what its got coming, hopefully microsuck will reduce it to the dung pile

Same thing that happens to everything Mocrosoft purchases

Anonymous's picture

mmmm let me think, a long long time ago I remember Word Perfect, MS doesn't purchase anything to bring more choice to the consumer, if anything the opposite is true. Oh the Irony that MS sprung up because of large corporations that practiced "Lock In" now it is they that have become the evil out of touch "IBM" of the present. Forgot their roots they did, morals I'm not sure they ever had.

Hey Doc, how does the Flickr business model work?

Anonymous's picture

Can the Flickr business be cloned?

Do you think Novell is next?

Flickr's business model

Doc Searls's picture

In a word, advertising.

In two words, advertising and memberships. If you pay to be a "pro", you get unlimited uploads and no advertising.

If you do image searches at Yahoo, you get to lots of Flickr shots. If you do the same at Google, you get none. From Flickr, that is. Draw your own conclusions.

Doc Searls is the Editor in Chief of Linux Journal

Is Novell Next ?

Anonymous's picture


We need your thoughts on this new Novell Link to help people get started using Microsoft Vista.

Read about the Vista migration here.

Flickr loses 2783 more photos

Mike Warot's picture

If this goes through... I'm yanking all 2783 photos that I currently share there.

The first thing they'll do is try to migrate it all to Windows servers, and do a bunch of .NET APIs with Silverlight required to do anything. It'll suck.

Then it'll get worse.

It's time to move to a decentralized personal platform for the post-server world.

Could hurt Microsoft

stephen's picture

This is a lot of money even for Microsoft. If this dosn't work for them it could cost them their lead stature. A lot of products that they have tried to get into have been a bust for them. Servers come to mind as well as other ventures. I think we are going back to the future. At one time every one shared a big frame computer through terminals. Now PC clusters serve PCs through the internet. This was and still is Unix and her daughters play ground. I think Microsoft can see this trend and realize either join in or they will lose mind share and their dominate market share of PC operating systems.

Monopoly watchers

Squichie's picture

Do you think that Microsoft might face legal action because of an expanding monopoly?

I have never liked yahoo, and dont care for microsoft either.
Yahoo has always been useless, or not as useful in comparison to other services out there. Their search engine is no better than MSN's. and the first half of the page is usually sponsored adds which are useless. Yahoo continually effs* up, and the only thing they have in common, is that they get pwned by google.

My sincerest hopes go out to google, as I am convinced they are a good company full of good ideas, that will benefit mankind. They are who I put my support behind!

Best line so far

Doc Searls's picture

Dave Winer:

Does Yahoo + Microsoft make sense?

Nahh. It's like the dead leading the blind.

Speaking personally, it matters to me that I've got about 18,000 pictures on Flickr, and we (Linux Journal) have our own growing pile there too. (With a lot more coming when I pull them off a hard drive I left at my old place and I'll get to later this month.)

We're on Flickr for a reason that goes beyond its excellent services: 1) It runs on Linux; and 2) It has very open APIs. Thanks to Flickr, I have a big pile of collages at Tabblo too.

In fact, Microsoft has a lot of open APIs, and has done some nice work on the open direction, especially around Identity.

I just wonder at this point if Yahoo goes away.

Doc Searls is the Editor in Chief of Linux Journal

Bad news for Zimbra

Anonymous's picture

I suspect the current best contender for exchange-killer will be history. Hopefully the open source commmunity and/or the original developers will be able to keep it alive.

Zimbra threat

Curtis Vaughan's picture

I could care less about Yahoo, but my first thought was that MS is out to kill Zimbra. One person replied to me that don't worry Zimbra's open source. But then another told me (I haven't looked into this myself as is evident) that to the contrary, Zimbra is licensed under some Yahoo open source license. Therefore, MS could shut it down.

well, linux users still have

beso's picture

well, linux users still have kolab, which is lot better than zimbra in my opinion.

Zimbra's a big one

Doc Searls's picture

Good point about Zimbra. That's one that worries me.

Doc Searls is the Editor in Chief of Linux Journal

Microsoft owned Yahoo!?

John Eckman's picture

I will let my tweet from this morning speak for itself: DO NOT WANT

Perhaps YHOO influences MSFT more the MSFT influences YHOO?

Anonymous's picture

Assuming that acquisition doesn't result in huge layoffs in Yahoo (engineering in particular) then it could end up diluting the pro-proprietary forces with MSFT, and provide a convenient rationale for a changing of attitude towards open-source? Could lead to some rather interesting questions around the IP sabre-rattling, since I'm guessing all those Yahoo linux servers probably don't (all) run SUSE and definitely don't run Xandros or Linspire.

Having said that huge acquisitions don't have a great history, and for the time being I can't think of many where the smaller ate the larger. HP-Compaq was generally ugly, and despite both doing lots with open source plenty of good stuff got caught in the crossfire - luckily the overall open source strategy survived and has been built upon.

Definitely the thought of the day around the people I know has been 'Crap, what do I do with all my photos on flickr now?' - while I struggle to think that anyone would be stupid enough to switch over a well running, highly successful, service just for the PR buzz, they did eventually switch Hotmail from FreeBSD and then proceeded to completely and utterly ruin it - so anything is possible.

Never Good to Be the Bought

WorkingWriter's picture

Been through this a few times. The company doing the buying always says "We love your culture, and want to learn from it." Then inertia sets in, and the people in charge bends the folk who were bought to their will. And M$ always has plenty of will.


Oblivion's picture

@jeckman, I believe this is one of the rare cases when the proper spelling of that would be, "Microsoft pwn3d Yahoo!"

My gut hurts at the thought of it.

I know that Yahoo rejected

Anonymous's picture

I know that Yahoo rejected the MSN bid but I am still wondering why did they do that..All the data would point to an acceptance of the bid. Any new bids on the horizon?
Or is a dead story already?