Microsoft ends its siesta, plays hardball

BOGOTA, Colombia---In the time it took me to fly here from Miami, Microsoft's patience wore out.

As you may have read by now, the company went public Saturday with a letter to Yahoo's board imposing a three-week deadline. Come to the table and negotiate a deal or prepare for a proxy fight.

Of course, this letter didn't come out in the hour and a half I was sitting on the tarmac in Miami, but rather just after the plane took off for the three and a half hour flight. Luckily, my cell phone had Internet access from the moment I landed and the hotel has perfect Wi-Fi as well.

But back to Yahoo. Apparently, Microsoft grew tired of Yahoo's glacial pace. The software maker noted that its limited discussions with Yahoo have been less than fruitful.

Microsoft's latest move is clearly an attempt to get things kick-started without having to preemptively outbid itself. The software maker is in an interesting position. Its offer, when made February 1, was worth $31 a share in cash and stock.

The deal, as it was initially proposed, would be worth somewhat less due to a decline in Microsoft shares. However, those close to the company have made the case that Yahoo's shares might be a whole lot lower were it not for Microsoft's offer being on the table.

In any case, it will be interesting to follow what happens next, albeit from the Southern Hemisphere. Attention sources, expect a very long distance phone call.

[lmasanti]

Why is MS pushing?

It can "put a new board". It can "get the shareholders".<br />Why the hurry?<br /><br />Maybe the "board" is too costy? Maybe the shareholders ask <br />"more money"? Or "just say NO"?<br /><br />Or does Bill Gates want this "ended" before leaving? (He probably <br />knows that if he has to do a "second coming" it would be more <br />on the lines of Michell Dell than in those of Steve Jobs!)<br /><br />And what if MS looses this fight? What's next move? Even the <br />"best economic and strategic" move will be seen as a "forced <br />act".<br /><br />MS is just play hard because the "little David" put Goliat against <br />the ropes!

[scannall--2008]

Same old story

It's what they have always done. Make marginal software, but <br />expand market share by buying others out. Or crushing the ones <br />that don't go along.

[mikalg]

Its "Goliath"

besides, not much else of your post made much more sense either.

[AppleSuxLeo]

Hardball is how business gets done...

Be Bold...kick their a** MSFT.

[jkeels]

Mmmm Hmmm

And in the process of playing Hardball you become a complete jerk for a dollar sign and decimal point. Business requires intelligence, negotiation and sometimes a firm approach. However, those in business who use the hammer to beat the stake into the heart of everyone around them do not get my respect.

[nightflyer32]

And once again...

Msoft sticks to the two old theories: 1) if you can't make it or <br />compete with it, you just buy it. And<br />2) You can never own so much that you can't own a little more.<br /><br />Go to hell, Microsoft. I hope the shareholders have more principles <br />than to just be one more sell-out to the Gates-Balmer machine.

[snatchmo]

Ballmer is really serious about this?

Interesting indeed. So we will see MSFT at $25 this week as the <br />prospect of this deal not getting done dwindles. The best MS could <br />hope was that the rest of the world forgot and MSFT could just <br />walk (run) away from this deal. YHOO will be an albatross for MSFT.