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News: Bill Gates On Yahoo And Damage Control For Vista

Posted on 09. May, 2008 by Benjamin Patton in News

Microsoft Corp. Chairman Bill Gates said Wednesday the company isn’t pursuing other deals following its withdrawal of its $47.5 billion takeover bid for Yahoo Inc. Separately, Mr. Gates was also upbeat on the troubled Vista operating system.

Speaking at a news conference in Japan, Mr. Gates said the company put “a lot of effort” in the talks with Yahoo and has decided they should pursue “independent paths.”

Over the weekend, Microsoft withdrew its three-month-old unsolicited bid for Yahoo after seeing the impasse with Yahoo’s board over a mutually acceptable sales price.

Microsoft Chief Executive Steve Ballmer said the company had been willing to raise its offer for Yahoo to $33 a share, or $47.5 billion, up from an initial bid valued at $44.6 billion, or $31 a share. At the time the negotiations collapsed, the value of Microsoft’s original offer had fallen to $42.3 billion, or $29.40 a share, because half of the deal was supposed to be financed with Microsoft’s declining stock. Yahoo’s board wanted $37 a share — a price that the company’s stock hasn’t reached in more than two years.

Mr. Gates said Wednesday that Microsoft was determined to make “advances” in its own search offering, including marketing, and meetings were in the works in Seattle to hammer out more specific plans.

Microsoft trails Google Inc. in the online search and advertising markets, and the bid for Yahoo was an attempt at turning that around. “We will make the advances that give people the great choice there,” he said.

On Tuesday in South Korea, Mr. Gates said he wasn’t ruling out alternative partnerships. Possibilities include large Internet companies like Time Warner Inc.’s AOL and News Corp.’s MySpace and promising start-ups like Facebook Inc. and LinkedIn Corp. Microsoft already owns a 1.6% stake in Facebook, the second-largest social network behind MySpace. News Corp. also owns The Wall Street Journal.

Mr. Gates also provided an update on Windows Vista Wednesday, saying the sales pace of the new operating system has been “rapid” and the software company has sold 140 million copies world-wide so far.

Despite Mr. Gates’s bullish comments, the introduction of Vista hasn’t exactly been smooth since its January 2007 launch. The new operating system received lukewarm reviews, and around 160,000 people have signed an online petition asking the company to continue selling its predecessor Windows XP until the next version of Windows is released. XP is set to be pulled off store shelves by June 30.

Mr. Gates said Microsoft is “hard at work” at developing the operating system to follow Vista, code-named Windows 7. He said that historically, the company has unveiled new systems every three years, but declined to say when the new software might come out this time around.

I find it insane to think that after a huge plunge in yahoo’s stock that they will not reconsider a buy out plan at this point. It is nice to see a company stick to their guns even with this kind of opportunity hanging over their heads. Only time will tell what will ultimately happen. In the mean time Google will remain the 900lb gorilla which even the likes of Microsoft can not top at this point.

As far as the Windows ME2 debackle… Well nothing new their except that try as they might to spin this OS to everyone its just not selling. An increasing number of people are signing an online petition to keep xp on the shelfs until the next windows OS is released. I know one thing. I would rather not be Steve Ballmer.

Parts of this article taken from The Wall Street Journal.

Tags: Bill Gates, microsoft, steve ballmer, steve jobs, yahoo