Microsoft, Yahoo Corporate Cultures Closer Than They Seem
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Yahoo's reputation for being an edgy startup is years out of date, while Microsoft is stodgy, but not as ossified as many might think. So, should the two merge, reconciling the corporate cultures many not be that difficult.
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How can two companies come to such widely divergent opinions on technology?
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IT is undergoing the kind of cultural evolution that companies endured when they first pushed computing technology out to the bulk of their workforces.
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Yahoo! and Microsoft need each other -- to populate the world with Googlephobes.
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By MICHAEL LIEDTKE  00 SAN FRANCISCO - As its rivals create a bigger buzz on the Internet, Yahoo Inc. is hitting television and radio airwaves to remind people that its Web site remains on the cutting edge of technology and culture.
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Although it is not yet widely visible to the outside world, some people inside Microsoft are beginning to break that mold.
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Microsoft division president Kevin Johnson talks up the bid, but offers few specifics on key topics, such as cultural differences, which brands Microsoft plans to keep and what it will do if Yahoo refuses to come to the negotiating table.
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Microsoft once faced an epic antitrust battle in Washington, and political scrutiny of a Yahoo purchase is certain. But a lot has changed in a decade.
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Most of the talk about Microsoft's hostile offer for Yahoo has focused on whether the deal could tip the scales in the battle for Internet dominance. Today, I'd like to steer the conversation to something a little more basic that almost everyone has overlooked: the numbers.
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Despite denials, the exodus may be prompted by fears of a radical shakeup if Microsoft's attempt to acquire Yahoo is successful.
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Server virtualization may be enterprise computing's latest technology, but a recent survey of corporate IT buyers shows that near-term adoption may not match the hype.
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At first blush, Microsoft's proposed acquisition of Yahoo for $46.6 billion is about growing its consumer advertising and portal business to better compete wit Google. And that's certainly part of the mix, but perhaps lost in the discussion is how such an acquisition could help Microsoft execute its software-plus-services strategy for delivering business apps over the Internet faster and better, said several analysts. That strategy could help Microsoft compete with Google's own business-apps initiative, they said.[ Follow InfoWorld's ongoing coverage of Microsoft's offer to buy Yahoo ]"Yahoo has very efficient datacenters, as does Microsoft," noted Rob Koplowitz, a Forrester Research analyst. By combining their datacenters -- and, more important, their engineering talent -- Microsoft should be able to move faster and more efficiently on delivering business apps over the Internet, something that Microsoft has done at a fairly slow pace so far. "Yahoo's engineers can help," he noted, "And you know that there'll be engineers who are freed up" after the acquisition, should it go through."Although Google Applications have yet to make a real dent in the Microsoft Office giant, they do pose a long-term threat," said David Mitchell, a senior IT researcher at the consultancy Ovum. "As a defense against this position, Microsoft needs to accelerate its own move into online services. The online engineering capabilities that Yahoo has will undoubtedly offer Microsoft the potential to bring new services to market" and will help Microsoft stay competitive.Koplowitz said he does not believe Microsoft is trying to buy specific technology from Yahoo to fill a hole needed to compete against Google's business offerings. Microsoft wants more talent and capacity to follow its existing strategy, he said. Google's approach is to offer pure Web-based apps, which he noted are more mature than Microsoft's Web-delivered apps. Microsoft's approach is to extend its 450 million Office desktop seats through additional software delivered via the Internet. The strategies have some overlap, but because they are different, Koplowitz expects Microsoft and Google to take different technology paths rather than try to copy each other.Microsoft's acquisition of Yahoo would also bolster the company in another area where it has fallen behind Google: search, said Charlene Yi, a Forrester analyst. "Microsoft is interested in search because it provides a beachhead into businesses -- especially small and medium-sized ones that don't have a direct relationship with Microsoft," she said, as businesses typically buy Office software from retailers and resellers. Google is using search to forge those direct relationships and then offer business apps that compete with Microsoft's plans.
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Chief Executive John Chambers and Chief Software Architect Bill Gates may have different leadership styles. And their firms certainly specialize in disparate aspects of the computer-Internet spectrum.
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Internet-centered programs that compete with the core products of Microsoft are a driver of its bid for Yahoo.
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Charles Arthur: Why Google might benefit from Microsoft's attempt to shoehorn Yahoo into itself
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Yahoo's fiercest competitor, Google, has raised concerns about the possibility of Microsoft's takeover. Google's motives, of course, are hardly pure.
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Microsoft executives said very little on Friday about the undeniable challenges of integrating the company&#39;s Internet division with Yahoo, largely avoiding the proverbial elephant in the room that could delay or, in some cases, eliminate benefits of the deal.