REDMOND, Wash., Feb. 1 — Microsoft Corp. today announced that it has made a proposal to the Yahoo! Inc. Board of Directors to acquire all the outstanding shares of Yahoo! common stock for per share consideration of $31 representing a total equity value of approximately $44.6 billion.
So everyone’s probably gonna spazz out on this one. Understandably so — in Flickr, Upcoming and del.icio.us you’ve got three of the most trusted and loved sites out in the nerdwebsphere. In addition, there’s a lot of respected people, both in web development and open source, at Yahoo. Joining Microsoft, an organization that has minimal respect in the web development and open source communities, would reduce those people’s cred right out of the gate.
But, were this bid successful, here’s what I hope would happen. Microsoft uses it as an opportunity to rebuild themselves organizationally. They bury the hatchet with open source and open up the development of IE. Yahoo continues building apps like Flickr and del.icio.us like they always have. A rewrite on .NET technologies isn’t imposed like it was on Hotmail. In the end, Microsoft becomes an organization where closed source, proprietary development can flourish with open source, standards-based processes.
This is just wild guessing on my part. That said, if you look at Microsoft, its clear they are having major execution problems. Xbox is the only group that is widely successful and even they have hardware problems. All the other groups are missing timelines and customer/developer expectations. Just like Yahoo was before they picked up Flickr, del.icio.us, Upcoming, etc.
If Yahoo can make acquisitions to rebuild their culture, perhaps Microsoft can too.