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Good News, Bad News on Microsoft-Yahoo
If you own stock in Yahoo, Microsoft's desire to buy is great news. If you work at Yahoo, maybe not so great.
Earlier in the week Yahoo announced it would cut 1,000 jobs, almost 10 percent of its workforce. Combining Microsoft's Web operations with Yahoo will inevitably result in more drastic cuts.
Slicing jobs will boost profits for a while and mask the bigger challenge: Fusing two sub-par Web development cultures, neither of which could prove itself able to effectively compete against Google.
Microsoft's Web group was overshadowed by a PC-centric worldview where near-monopoly operating systems and applications software were delivered on physical disks. Yahoo's organization is dysfunctional through and through.
Microsoft-Yahoo must build its own new, innovative, efficient culture out of that raw material — a tough task, and maybe impossible.
Rumors have circulated for months about this deal. Why did the companies wait until now? Maybe Bill Gates wanted to make sure he'd be out of the picture.
by Russ Mitchell
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