A Deal Against The King - JRM


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A deal against the KING - JRM

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A Deal Against The King - JRM

  1. 1. “ A deal against the KING” From: Jay R Modi, MBA
  2. 2. In the past…. <ul><li>In spring 2008, Microsoft made a $47.5 billion hostile offer to buy Yahoo that went into vein. </li></ul><ul><li>It led to lots of soul-searching at Yahoo and the replacement of its co-founder Jerry Yang with an outsider, Carol Bartz, in the chief executive role. </li></ul><ul><li>continued… </li></ul>
  3. 3. In the past…. <ul><li>In summer 2008, Microsoft denied its interest in acquiring Yahoo, but said that it would like to enter a deal for Yahoo's search advertisement business. </li></ul>
  4. 4. <ul><li>… ..and finally the deal got stuck against our own, yes its our on 29 th July 2009 </li></ul>
  5. 5. <ul><li>… ..the whole economy was still recovering from the clutches of recession but the world’s largest software giant got its wish accomplished. </li></ul><ul><li>continued… </li></ul>
  6. 6. <ul><li>… .. gets better opportunity to compete more effectively with Google in online search and advertising. </li></ul>
  7. 7. <ul><li>… .world’s second largest search engine </li></ul><ul><li>will be directly benefited to use Microsoft’s search </li></ul><ul><li>technology on its website. </li></ul><ul><li>continued… </li></ul>
  8. 8. <ul><li>… . also receives a big bump in annual revenues, 88% of the search-generated ad revenues from its own sites for the first 5 years of the 10-year deal, much higher than is standard in the industry. </li></ul>
  9. 9. Can Yahoo-Microsoft jointly capture half of the market share? <ul><li>Well its hard to predict this so early but its not that difficult….. </li></ul><ul><li>continued… </li></ul>
  10. 10. Can Yahoo-Microsoft jointly capture half of the market share? <ul><li> is launched couple of months back and is getting positive reviews. </li></ul>
  11. 11. My thoughts… <ul><li>Personally I’m obsessed with using Google but when I searched with my name “Jay R Modi”, surprisingly I got the same number of hits that I get in Google. </li></ul><ul><li>So if not better, I can say that is as good as Google. </li></ul>
  12. 12. Can Yahoo-Microsoft jointly capture half of the market share? <ul><li>Yahoo-Microsoft’s combined share is less than half of the Google’s total market share </li></ul>65% 8% 20%
  13. 13. My thoughts… <ul><li>For the next 5 years, there is no chance to surpass Google. Yes, I am quiet confident on this. </li></ul><ul><li>Google has 2/3 of market share not just by fluke but its because of “Customer satisfaction and Customer loyalty” </li></ul>
  14. 14. Can Yahoo-Microsoft jointly capture half of the market share? <ul><li>Under the 10-year deal, Yahoo.com and Bing.com will maintain their own branding but search results on Yahoo.com will say &quot;powered by Bing.&quot; Yahoo, in turn, will be responsible for attracting premium advertisers. </li></ul>
  15. 15. My thoughts… <ul><li>I think that Microsoft got a bigger bite over burger. </li></ul><ul><li>It has got market share from 8% to 12% with no upfront payment. </li></ul><ul><li>continued… </li></ul>
  16. 16. My thoughts… <ul><li>Microsoft also has revenue share of ads served over Yahoo’s much larger volume. </li></ul><ul><li>… .and how can we forget the increased audience for Microsoft among internet users. </li></ul>
  17. 17. Some quotes from the greats… <ul><li>When the shares of Yahoo fell 12 percent, to $15.14, after the deal was announced. </li></ul><ul><li>“ It certainly feels like Yahoo is giving away their strong and hard-fought share of the search market for really a modest price.” </li></ul><ul><ul><ul><ul><ul><li>Darren Chervitz , the co-manager of the Jacob Internet Fund (owns about 100,000 shares of Yahoo) </li></ul></ul></ul></ul></ul>
  18. 18. Some quotes from the greats… <ul><li>After the deal announcement. </li></ul><ul><li>&quot;I got an opportunity to swing for the fences in search.&quot; </li></ul><ul><ul><ul><ul><ul><li>Steven A. Ballmer , Microsoft's chief executive </li></ul></ul></ul></ul></ul>
  19. 19. Some quotes from the greats… <ul><li>After the deal announcement. </li></ul><ul><li>&quot;By combining the ... technology of both companies, we can create a real, viable alternative for advertisers.“ </li></ul><ul><ul><ul><ul><ul><li>Carol Bartz , Yahoo Chief Executive </li></ul></ul></ul></ul></ul>
  20. 20. My Questions ??? <ul><li>Is this deal going to get a green signal from antitrust hurdles like EU? </li></ul><ul><li>How this deal will affect customers? </li></ul><ul><li>Can we expect any new product or feature from Google as an answer to this? </li></ul>Please leave your comments to answer this questions. I hope you enjoyed this presentation.
  21. 21. References <ul><li>www.businessweek.com </li></ul><ul><li>www.cnnmoney.com </li></ul><ul><li>www.blogs.nytimes.com </li></ul>