Filed under: acquisition, fragmenting search market, purchases, search engine marketing, search engines, useful article, world domination | Tags: microsoft, msn, search engine dominance, search engine marketing, yahoo
Exciting news in the world of search engine marketing, more thoughts and comments to come when I have the time!
Microsoft offers to buy Yahoo
Microsoft offered to buy Yahoo for $31 per share, a 62 percent premium over Yahoo’s closing stock price on Nasdaq Thursday. Yahoo shares jumped to $30.75 in premarket trading.
Yahoo said the online advertising market is growing rapidly and expected to reach nearly $80 billion by 2010 from over $40 billion in 2007. Yahoo added it is “increasingly dominated by one player,” referring to Web search leader Google.
“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,” Microsoft Chief Executive Steve Ballmer said in a statement.
Yahoo was not immediately available for comment.
The company has been losing market share to Google and warned earlier this week that it faced “headwinds” in 2008, forecasting revenue below Wall Street estimates.
On Thursday, Yahoo disclosed that nonexecutive Chairman Terry Semel was leaving the board, ending its formal ties with the former chief executive, who is credited with reviving the company and then losing touch.
Semel, replaced as CEO last June, had faced heavy criticism for failing to move faster to meet both rival Google’s challenge in Web search and advertising and, more recently, the rise of social networking sites such as MySpace and Facebook.
U.S. stock futures jumped on the Microsoft news, which offset a disappointing earnings report from Google late Thursday.
Paul Mendelsohn, chief investment strategist at Windham Financial Services, said a deal made sense.
“Yahoo is having a really tough time competing against Google. Whether it’s a good price, I can’t see anybody else who is going to outbid Microsoft,” Mendelsohn said.
Microsoft said it had identified four areas that would generate at least $1 billion in annual synergies for the combined entity.
Tim Smalls, head of U.S. stock trading at brokerage firm Execution LLC, was less enthusiastic about the benefits of a tie-up.
“Shocking! To me, the premium seems exorbitant, for what is a dwindling business. I personally don’t see how the synergies of Microsoft-Yahoo is going to take on Google,” Smalls said.
(Reporting by Franklin Paul and Tiffany Wu; Editing by Lisa Von Ahn/Jeffrey Benkoe)
Copyright 2008 Reuters
Filed under: google, search engine marketing, tv advertising, world domination
They will take over the world one day! surely they cant be competitive if they are just buying the ad space and reselling with profit attached!?! I cant help but think this is just another example of google spreading their net without actually applying themselves to it. In my opinion they should concentrate on what they do best, rather than trying to enter every market which springs to mind.
Google has begun a test of buying and reselling television commercials, according to reports from the Wall Street Journal, reports Search Engine Land. The tests are apparently taking place in Concord, California and mimic the system Google put into place when it began selling print ad space. It buys time from the television station and then resells the spot time to one of its advertisers. That spot then appears within ordinary commercial breaks and appears no different to the viewer from any other commercial.
Advertisers secure their ad space through an auction system, but one that’s overseen by people and not an automated system, since it’s still early in the test period.This test phase is the first time that Google’s entry into the TV ad market has gone beyond statements of intent or in-house experimentation. Google has partnered with cable provider Astound Broadband for the test.
