Google Goes For Yahoo! Partnership
Google has reportedly proposed a partnership with search rival Yahoo! in an effort to escape Microsoft’s $44.6 billion hostile takeover bid.
It is understood that Google chief executive, Eric Schmidt, yesterday telephoned Yahoo! founder, Jerry Yang, to propose working together.
A partnership between the two could see Yahoo! outsource its search and advertising functions to Google while it concentrates on other areas such as mobile applications and social networking.
A report on MediaGuardian says that Google has also canvassed alternative bidders – including AOL Time Warner – in an effort to avert a Microsoft takeover.
Speaking at a briefing for Wall Street analysts yesterday, Microsoft’s chief executive, Steve Ballmer, said: “We think it’s a generous offer. We trust the Yahoo! board and shareholders will join with us quickly in moving down an integrated path.”
He added: “Google’s clearly got a dominant position. They’ve got about 75% of paid search worldwide. We think this enhances competition. Anything else would be less good from that perspective.”
Meanwhile, two sources “familiar with Yahoo!’s strategy” told Reuters that Yahoo! believes Microsoft’s $31 a share bid “undervalues the company”.
It was revealed on Friday that Microsoft had made a bid for Yahoo! (see Microsoft Offers To Buy Yahoo! For $44.6bn), which if it were to go through would be the largest ever takeover in the technology sector.
Last week Yahoo! announced that its Q4 profits fell 23% to $206 million, down from $269 million a year earlier, and confirmed plans to make 1,000 job cuts, its first cuts in six years (see Media In The City: Microsoft Makes Move On Yahoo!).
Richard Firminger, regional sales director, Northern Europe, at Yahoo!, will join the panel at MediaTel Group’s ‘Future of Online’ seminar in London next week, where the current news surrounding the company will no doubt be discussed, as well as other issues facing the sector in general (see ‘Future Of Online’ Line-Up Finalised).
Yahoo!: 020 7808 4200 www.yahoo.co.uk Google: 020 7031 3000 www.google.co.uk/