Amongst all the handwringing and talk of Yahoo’s stock price plunge Jason Kottke makes a pretty salient observation…
On Jan 31, the day before Microsoft offered $31/share for Yahoo, YHOO was at $19.18/share (market cap: $26.4 billion) and MSFT was at $32.60/share (market cap: $303.6 billion). At the close of trading today, YHOO closed at $24.37/share (market cap: $33.5 billion) and MSFT was at $29.08/share (market cap: $270.8 billion). In other words, the Microsoft offer increased the value of Yahoo! Inc. by more than $7 billion and decreased the value of Microsoft Corporation by almost $33 billion.
Certainly Yahoo’s stock price wasn’t on fire before the Microsoft offer and Yahoo has issues, but personally I’m erring toward the don’t sell side of the fence. Not because I don’t like MS (I do and I use MS Products all day long), it’s more because I like the idea that there are three big guys competing in search, I really like lots of the Yahoo products, I think they’ve brought lots of great talent in many of their acquisitions, and I want to see them have a chance to pull it all together.
I have no skin in this fight and I have no real insight to most of the big issues here (eg. cultural fit, technology fit, people fit), but selling doesn’t feel good for the internet.