You know, Google buys companies, Yahoo buys companies (a lot lately), but…Microsoft ain’t playing, really. Have I missed their acquisitions? I remember back when they ruled the OS roost, they bought a lot of companies, and/or they did due diligence and then built the idea into their OS. What gives? Have they forgotten how to buy teams?
Random Note
You know, Google buys companies, Yahoo buys companies (a lot lately), but…Microsoft ain't playing, really. Have I missed their acquisitions? I remember back when they ruled the OS roost, they bought a lot of companies, and/or they did due diligence and then built the idea into their OS. What…
they did buy Folder Share
It’s a great point. They’ve got money and need market share, so I’m wondering if this relates to the plans to pay users to use MSN search.
It’s potentially a destabilizing idea, since the current search landscape is built almost entirely on advertising money from free traffic at Google, Yahoo, and MSN.
Reminds one of the days when people paid a dollar for a political vote. If I remember history correctly those guys usually won.
hm, reminds me of a simpsons clip:
http://video.google.com/videoplay?docid=778874834683644747&q=simpsons
They’re still acquiring, but seem to be doing so behind closed doors. A friend of mine worked for a small company that just got bought out by MS a month ago. Maybe a fifteen person team, paid them well, but there wasn’t any fanfare because they weren’t working on Web 2.0/search/media products.
There’s Teleo 2 months ago. They saved about $3 billion on that pick-up and you probably wouldn’t have made the post if they had bought Skype.
Microsoft’s MSN group, in particular, hasn’t done a lot of acquisitions. They acquired Lookout (the extension to Outlook for search) and MessageCast (alerts and RSS) fairly recently, I believe. In general, though, Microsoft appears to prefer to build rather than buy.
Small acquisitions can be hard for a lot of these lumbering giants. Acquiring a 2-10 person company often is treated the same as acquiring a 100+ person company. That means there are high transaction costs and overhead. Smaller companies have less history, increasing perceived risk. And larger acquisitions are more glamorous and more easily attract champions within the firm. So there tends to be a bias against smaller acquisitions if the same process is used.
It is unfortunate. Research shows that larger acquisitions tend to fail due to the complexity of merging large teams and lack of expected “synergy”. Smaller talent and technology acquisitions are simple and tend to deliver better returns.
Microsoft does lots of small acquisitions, usually about 10 a year. Off the top of my head there is; Giant Software, Sybari, Groove Networks, Frontbridge, Teleo, and FolderShare. I did a blog entitled “Microsoft will acquire my company” http://dondodge.typepad.com/the_next_big_thing/2005/10/microsoft_will_.html
with details on some of the earlier acquisitions that went on to be the basis of Powerpoint, MS Project, Live Meeting, Hotmail, and others.
Incidently, I did another blog on your book. The post was entitled “The Search – An insiders response” http://dondodge.typepad.com/the_next_big_thing/2005/10/the_search_an_i.html
I was director of engineering at AltaVista and worked with Louis Monier there.
Cheers,
Don Dodge
I think Google’s best products have been created inhouse (I consider their `best’ products to be Gmail and Maps). Yahoo!’s best products were purchased (I consider their best product to be Flickr). Nearly all of Microsoft’s mature products were created inhouse, and I think it would be wise of Microsoft to continue on that bent. Instead of buying new companies up, a better way to forwardize their campus’ culture would be to make sure that they can compete with Google and Yahoo!’s Web2.0’ish products with their same inhouse style. If all they do is buy things up to compete I don’t think it will have an impacting change on the company.
are you shure, thats microsoft not buy companies too?!
not only google and yahoo buy companies, i think all major eBusiness do this. the last what i remeber is the buy from ebay (skype) for some millions
greetz
Jeffrey
whats the next what google or yahoo buys? a good chance with a little idea and some promotion to earn extra cash
@ chris … the new xbox is cool, nice link.
all eCommercial´s buy compannies, rather to earn more cash.
i believe the company MS is currently trying to buy is AOL… or at least secure the rights to their market & customers. probably a reasonable use of their cash. i’m sure there are other smaller opportunities that would make sense too.
re: Google, i actually don’t think they’ve been nearly as acquisitive as they could be, and i’m not sure they’ve done a hell of a lot with the companies they have bought. their parameters for acquisition skew towards smaller groups.
in the past i’d have said Google was focused on companies that were too young, Yahoo on companies that were too old — however lately, Yahoo seems to be pulling the trigger more often at various points in the food chain.
right now, i’d say Yahoo has done the best for its dollars… except perhaps for Murdoch & MySpace. that was definitely the best deal of the year by far.
– dave mcclure
“i believe the company MS is currently trying to buy is AOL… or at least secure the rights to their market & customers. probably a reasonable use of their cash. i’m sure there are other smaller opportunities that would make sense too.”
i hear the same and think thats not correct. you need more one only for a market and a marketsystem thats work, all other is a monopole of time
Mike
LinuxFreak
forgetten, yahoo has done best for its dollars? resell is better like relaunch? the status of yahoo is worldwide given and thats the base