Kara Swisher

Recent Posts by Kara Swisher

MicroHoo: How to Talk Without Moving Your Lips


While it is true, as we and everyone else have posted, that Yahoo and Microsoft still have not entered into or even scheduled any formal talks, even after the software giant’s threat to launch a hostile bid came and went over the weekend without action, it is also not true that there are no talks going on.

According to sources close to both companies, there are informal discussions now taking place between Yahoo (YHOO) and Microsoft (MSFT)–via bankers, board members, shareholders and others close to both companies–to try to prevent a hostile takeover scenario or the sudden withdrawal of Microsoft’s offer.

Both options are unattractive for a number of reasons to pretty much everyone and, in BoomTown’s opinion, an excellent example of how juvenile this takeover battle has become (or “amateur hour,” as one source close to both companies described it to me).

A hostile bid by Microsoft, for example, is profoundly distracting to both parties and could result in an exodus of Yahoo staff, along with being risky in terms of certain success for Microsoft.

On the other hand, a Microsoft pullout would undoubtedly result in a severe hit on Yahoo stock, which could also send talent fleeing. (Although, I suspect, it would not be quite as severe a share decline as some are predicting, given the company will still be in play and that will give it a bit of a boost.)

What’s interesting to me is how a lot of the strategies are being described as being needed to preserve face and macho status in the industry and on Wall Street.

So too the idea that is being put out by its CFO Chris Liddell that Microsoft will not pay more, in a refrain that is sounding suspiciously like that annoying Meineke Muffler commercial (“I’m not going to pay a lot for this muffler!”; see Meineke mummy video below).

That’s a canard, of course, part of the chest-thumping logic that brought us where we are now in this fight–at the corner of Nowhere and Nothing.

Here’s my suggestion–keep up the behind-the-scenes kibitzing, for sure.

But why doesn’t Microsoft CEO Steve Ballmer call Yahoo CEO Jerry Yang and ask him to come alone to some remote location (I like Napa Valley) and hammer the thing out, just between them and without a passel of advisers and execs to chime in?

Until then, of course, it will be a lot of noise with no sound.