Microsoft/Yahoo Merger: The Dark Side of the Loon
When I heard about the whole Microsoft/Yahoo! situation, I immediately reacted in a very negative manner. But, rather than immediately flying off the handle, I decided to hold back a bit, let it play out a bit, and see how everyone else responds. Now that both Google and Microsoft have made their statements, the picture is getting clearer and the impact of a Microsoft/Yahoo! merger couldn’t be any clearer: It’s bad news!
I’ve been using open-source software for the better part of two years. My job depends on them. I use the typical LAMP setup (LInux, Apache web servers, MySQL, and PHP) and use other open-source tools like Eclipse and Aptana to get the job done. All of these tools help in contributing to another open-source software project, a PHP-based content management framework called MODx. The level of innovation that is born out of all of these tools is absolutely amazing.
Now, let’s look at a statement by Brad Smith, General Councel at Microsoft:
The combination of Microsoft and Yahoo! will create a more competitive marketplace by establishing a compelling number two competitor for Internet search and online advertising. The alternative scenarios only lead to less competition on the Internet.
Today, Google is the dominant search engine and advertising company on the Web. Google has amassed about 75 percent of paid search revenues worldwide and its share continues to grow. According to published reports, Google currently has more than 65 percent search query share in the U.S. and more than 85 percent in Europe. Microsoft and Yahoo! on the other hand have roughly 30 percent combined in the U.S. and approximately 10 percent combined in Europe.
Microsoft is committed to openness, innovation, and the protection of privacy on the Internet. We believe that the combination of Microsoft and Yahoo! will advance these goals.
The interesting thing is that Microsoft is only focusing on the search engine and advertising part of the deal in their statement. Problem is that search and advertising are just one part of the equation. Granted, Google is the big dog when it comes to search and advertising, but Google didn’t get that way with just their search services alone. It took other services to do that. Google created some very well thought-out, well designed online apps and made search and advertising an integral part of some of these services. They made it where these services end up being a big part of your life because you can get to them from practically anywhere. I’m not sure if Microsoft understands this.
Just like Google, Yahoo! is more than just a search and advertising company. Granted, they’re not as successful as Google, but given time they potentially could be. You see, just like Google, Yahoo! has done a lot to contribute to the open-source community. Contributions like the Yahoo! User Interface Library encourage innovation and show that open-source isn’t as evil as Microsoft would have you believe. And, just like Google, the majority of Yahoo!’s services are built off of open-source software.
If the merger happens, it’s almost a given that Yahoo! will essentially be gobbled up and spit back out. The problem is that since most of Yahoo!’s services are not built off of the Windows platform I just don’t see how Microsoft will be able to merge Yahoo!’s infrastructure with their own. Do they seriously thing they’ll be able to reverse engineer any of this stuff? Doubtful.
The thing Microsoft isn’t telling you is that there is perhaps a bit of a ulterior motive to this merger. Microsoft clearly wants to knock out the competition Yahoo! poses in search and advertising, that much is clear. But I think Microsoft also wants to give a direct hit to the open-source community by also knocking out a few services that pose as big of a threat…services like Del.icio.us, Flickr, Upcoming.org, and Zimbra. With the exception of Zimbra, the other services aren’t much of a threat. But, because their built off of open-source, they’ll probably be dumped or reverse engineered into a nightmare. Given Microsoft’s history, the chances of Microsoft allowing any of these services to continue to exist on their own for long is slim to none.
The bigger threat is Zimbra, an open-source messaging and collaboration suite that is in direct competition with Microsoft Exchange. Killing this means killing the one thing that would allow companies to successfully migrate their existing Exchange servers on over the Linux. Steve Ballmer has made it clear that he’s not a fan of open-source so killing Zimbra would be a clear blow to the bow of the open-source community and Linux.
As the Wall Street Journal has reported, Yahoo! is set to reject Microsoft’s bid. Let’s hope that Microsoft doesn’t have a leg to stand on with this. If Microsoft was smart they would back off and perhaps learn to do the one thing they should have been doing all along: Make better software!
Tags: yahoo
