CBS+CNET=The Future of Yahoo?
by Kara Swisher
Posted on May 15, 2008 at 11:54 AM PT
So what other Web media company facing a hostile investor does CNET remind you of?
Disgruntled investors, a troubled Web 1.0 company whose management is recalcitrant to give in, an obviously powerful, but underutilized, set of assets.
The acquisition of CNET (CNET) by CBS (CBS) for $1.8 billion in cash is the happy ending of this scenario and, on first blush, I like it.
It is a fair price, but not excessive for CBS, which gets one of the highly trafficked sites in the tech news sector.
And it gives CNET–which was too big and yet not big enough to really move its own needle–cover from its shareholder attacks to make the kinds of changes to its business and products that it should have been making for a long time now.
Yahoo (YHOO), a much bigger deal, needs exactly this kind of resolution and soon, as its continued turmoil is hurting its prospects of returning to power.
Why? Most of all, key employees continue to eye the door or cannot help but be distracted from the business at hand with all the uncertainty swirling.
The problem for Yahoo, though, is that it is simply too large and too pricey to really have any real options other than a big purchase by, well, Microsoft (MSFT).
Unfortunately, after playing a lugubrious game of chicken for far too long in its acquisition battle with the software giant, Yahoo has truly lost any leverage it might have had in making decisions about what it wants to do next.
Instead, it is now caught up in the maelstrom of Carl Icahn and all he represents, which is to say a story less about what is right for Yahoo and its products, employees and prospects and much more about its stock and how the vultures of Wall Street can make hay off Yahoo’s shares.
These investors have no tolerance for the who’s-zooming-who games Yahoo was playing with Google (GOOG), AOL (TWX) and others, in a vain search for alternatives to a Microsoft takeover.
So if I were Yahoo’s Jerry Yang, I might be making my way to Redmond right now with hat in hand, in an attempt to control these talks instead of Icahn, because at least Microsoft is a company that is in and understands Yahoo’s business and would have the most respect for its business.
It’s also the one and only move Yang can make to ensure the future of the amazing company that he has built lives on in the way it deserves.
The sky is indeed falling, Jerry, so get to the king of Microsoft before the Icahn fox–as it did the guileless Chicken Little–eats you up.
