Billionaire takeover strategist Carl Icahn is looking at a possible play to force Yahoo back to the table with Microsoft to sell the company at a big profit. The news today sent Yahoo up about 1.30 and YHOO is still rising in after market trading.
Given that the prevailing stock price of Yahoo is well below Microsoft's top offer of $33 per share, this play has only one key challenge - making sure you can get Microsoft back to the table. Frankly I think that is not much of a hurdle to overcome as I think Microsoft Steve Ballmer's decision to drop the bid was 1) Mostly strategic to force the issue and 2) Will be quicly overcome if Icahn can seat a more sympathetic board of directors.
I'm guessing that Ballmer will have two basic requirements to return to the Yahoo table: No Google deals and no more Jerry Yang. Although it would be sad to see a founder of Yang's vision leave the company one does not need to feel too sorry for him. A Microsoft merger would value his stock close to 100% higher than the lows of a few months back, netting Yang in the neighborhood of an extra half billion over that low price.
Of course Yang has seen Yahoo trading at over $100 and I think part of his malaise over the deal is a longing for the good old pre-Google days where Yahoo was the high flyer in terms of value and buzz. Sorry Jerry, but despite Yahoo's suberb ongoing work in many aspects of the online experience, those days ... are ... gone.
Most analysts do not feel Yahoo can sustain even the current price levels without the "threat" of a takeover looming, which is propping up a share price that will likely drop to $20 or below if Yahoo had no serious takeover suitors. In fact YHOO was trading at about $18 per share a few months ago just before Microsoft bid which valued the internet empire at about 60% more than the market. Yet Yahoo argued this was not enough and the board, especially in the form of CEO Jerry Yang, went to great lengths to prevent the Microsoft Merger.
Icahn is no stranger to this takeover strategy and the graph above shows how successful it has been for him. Image Credit: Fortune Magazine Disclosure: Long on Yahoo
Maria Bartiromo at CNBC has a detailed interview with Google CEO, Eric Schmidt. The full transcript is here and I've noted some items below in quotes.
As we've noted here before, monetizing video and social media is very difficult. Schmidt confirms that is an ongoing challenge at Google:
... the whole social networking space has been harder for us tomonetize--that is, develop advertising businesses again--than some of theother--than some of the other spaces that we're in. It has to do what peopleare doing. When you think about it, you're in a social network, you'relooking at people's photos, you're figuring out where your friends are.You're not as likely to be purchasing a new car at the same time or purchasingclothes or purchasing a book or what have--whatever business that you're in.So the development of the advertising tools and techniques, literally theplatform, has been more difficult than we have thought. But we're working onit, and we're hopeful.
Regarding the explosive Mobile market, which clearly is a major focus for Google:
.... most people in most developed countries have a roughly 100percent coverage of mobile phones. So it really is a tremendous phenomenon. Over the next three or four years, there'll be more than another billion or somobile phones added. Eventually our numbers indicate that there'll be five or so billion mobile phones in a world of six billion or so. People, this is aphenomenon. It's an unprecedented reach, even greater than, for example,television, or even electricity in some cases. So that's a platform that we can exploit. Our mobile phone, both search traffic as well as advertising is growing very rapidly, and we think people will do more and more interesting things in mobile phones. And, I mean, small phones, big phones, big screens, things that don't look like a phone, things which are mobile.
The "deadline" imposed by Microsoft on Yahoo expired yesterday, which makes it likely that Microsoft is either preparing to drop their bid or - and this appears a more likely scenario - preparing for a hostile takeover where they'll try to get a new slate of directors approved for Yahoo who would view the takeover favorably, leading to a probable merge this summer.
Yahoo's board meets today and although it would be interesting to be there I'm certainly not envious of the Yahoo board right now. If Microsoft drops their current offer Yahoo stock is likely to drop severely - perhaps even below the 52 week low into the high teens. Shareholders will be understandably upset if fighting Microsoft has led to nothing more than a 30%+ drop in share price. Some have suggested a Google advertising partnership may help matters but I'm skeptical that the broad market views Yahoo as favorably as Yahoo seems to think. If they did one would expect Microsoft's share price to be faring much better than it has while people await the takeover verdict. In fact most stock watchers are convinced that if Microsoft announces they are dropping the quest for Yahoo MSFT will see a significant jump in share price.
Larry at CNET has noted some interesting alternative scenarios to a Microsoft Yahoo merger, even including a CNET option.
I think my prediction is the same as it has been for some time: Microsoft will start the hostilities but will also let Yahoo know they can get about $34 per share if Yahoo does not put up a fight. Yahoo will (finally) give in to avoid a potential price meltdown, lawsuits, and a fight that is only going to misdirect energy while both companies watch Google scoop up the increasing online advertising revenues.
Larry Dignan and Dan Farber at CNET have the early scoop on Yahoo's freshly unveiled Yahoo! Open Strategy somewhat cryptically labelled .... "Y!OS"
Ari Balogh, Yahoo CTO said at the San Francisco Web 2.0 Conference today:
“We are taking open to a whole other place,"... “We are rewiring Yahoo from the inside out with a developer platform that will open up the assets of Yahoo in a way never done before, making the consumer experience social throughout and provide hooks to developers.”
It is too early to know if this type of openness will be embraced by developers to the degree needed to make a significant impact in the way people use Yahoo services, but it is very encouraging to see how the key players are racing to claim the title of the "most open" online environments. Facebook's API's were followed by Google Open Social and now Yahoo which appears to offer more programmatic freedom than ever across Yahoo's massive number of network assets and 500,000,000 person user base.
Google has been named the world's number one and most powerful brand for the second year in a row clocking in at an estimated value at $85,057 million which represents a 30% increase in its brand valuation. This, according to BrandZ's top 100 brand ranking for 2008. Other tech heavyweights in the top ten included GE, Microsoft, China Mobile, IBM, and Apple which was the biggest mover in the top 10 and a new entrant, moving up from sixteenth to seventh place with an incredible 123% increase in brand value to $55,206 million. HP was at sixteen, Cisco ranked twenty-two, and Oracle and Intel at numbers twenty-six and twenty-seven respectively.
Google is a marketer's dream with its ranking being driven by financial performance and equity value. The brand equity measurement is determined by a global survey of 100,000 consumers.
Despite a small 1% drop this morning, stock in internet giant Google (GOOG) appears to be stable at the new price level of approximately $533 per share, about a 20% increase from the lows of last week. Until Thursday's favorable earnings report Google stock had come under severe downward pressure after reports that revenue could suffer from a major slow down in the increase in paid clicking at Google - by far the internet's most important advertising venue with control of approximately half of all online advertising.
Thursday's earnings, however, indicated that the reports of a Google revenue demise from fewer clicks had been greatly exaggerated. Clearly Google's quality control initiatives have managed to pull more revenue from each click. Click growth is certainly slowing based on Comscore and other large scale reporting, but Google once again has pulled a revenue rabbit out of their magic hat and in doing so has recovered some of the value lost during the stock slide of the past several months.
Google CEO Eric Schmidt has been critical of what he feels was irresponsible reporting by Comscore that led analysts to conclude that Google was in serious trouble. Although Comscore and Google had issued clarification on the implications of the reporting, Google's stock price had suffered severely in Q1 2008, mostly on the basis of how analysts interpreted Comscore's findings of a serious slowdown in paid clicks.
Microsoft has purchased the innovative travel service "Farecast" for a reported $115,000,000. SeattlePI has more about this breaking story. Farecast uses a predictive algorithm to help users determine if airline ticket pricing is poised to go up or down from the current levels and thus helps to find bargain pricing online.
Rather than develop extensive "Web 2.0" features internally, it is becoming very clear that Microsoft is trying to fuel their massive new web initiative with cash, buying companies like Farecast (and Yahoo) that can make Microsoft an immediate player in the rapidly evolving online environment.
Google stock soared in after hours trading to over $500 per share after a very favorable earnings report that suggests Google is doing a much better job of pulling revenue out of paid advertising clicks. After hours GOOG showed a gain of over 11% from today's closing price.
Google Q1 earnings report comes out after today's market close. Many consider this report to be a bellweather for the internet industry at large as well as for Google, given Google's massive dominance in the online advertising space.
A key issue is how well Google monetizes search clicks now that they have implemented new quality controls on advertising. Comscore reports suggest that the growth in total paid clicks is diminishing dramatically from earlier levels (though still up from last quarter), but Google has suggested that they now do a better job of pulling revenue from each paid click. This complex algorithmic balancing act between total clicks and revenue per click will largely determine the fate of Google's stock price after the close today.
CNBC has a short Google earnings preview with some of the key analytical issues associated with today's report.
Google watchers are anxiously awaiting the GOOG earnings report due this Thursday. Google shares, trading today at about $477 are off a whopping $270 per share from the 52 week high of $747.
Henry Blodget suggests that Google can show 25% growth but only throug a substantial increase in the price per click, a Google metric that won't be clear until the Thursday report.
This 25% growth estimate obviously assumes that Google has seen a strong increase in price-per-click: If it hasn't, and the Comscore data is accurate, US revenue will miss by a mile and Google's overall revenue will come in well below consensus. Thursday's earnings report will be interesting.
Click revenues are very dynamic making it hard to predict the effect on revenues of the changes at Google which are a funciton of of total paid clicks, which are up but very modestly over last years, and the revenue *per click*, which can vary with season, market, user interface, and other factors. Google has been seeking better quality control for pay per click advertisements which appears to have increased the revenue per click but also was a key factor in the huge decrease in the growth rate of total clicks.
As Bloget notes, Thursday's earnings report will be very interesting.
The number of searches in the U.S. on the major search engines increased from 9,882 billion in Feb'08 to 10,771 billion in Mar'08 representing a 9% jump. According to comScore, Google sites were the biggest beneficiaries and accounted for more than 6.4 billion core searches, followed by Yahoo sites with 2.3 billion, and Microsoft sites with 1 billion.
Google also continued to lead as the top search engine with a 0.6% increase in the share of searches followed by Yahoo, Microsoft and AOL which all experienced decreases in their market share.
comScore qSearch 2.0 Report - Total U.S. Home/Work/University Location
Searches Query Volume by Site
Search Entity Feb-08 Mar-08 Mar vs. Feb Total Core Search 9,882 10,741 9.0% Google Sites 5,855 6,438 10.0% Yahoo! Sites 2,136 2,296 7.0% Microsoft Sites 953 1,012 6.0% AOL Network 488 512 7.0% Ask Network 450 503 12.0%
* Based on the five major search engines including partner searches and cross-channel searches. Searches for mapping, local directory, and user-generated video sites that are not on the core domain of the five search engines are not included in the core search numbers.
comScore qSearch 2.0 Report - Total U.S. Home/Work/University Location
Share of Searches (%)
Search Entity Feb-08 Mar-08 Mar vs. Feb Total Core Search 100.0% 100.0% 0.0 Google Sites 59.2% 59.8% 0.7 Yahoo! Sites 21.6% 21.3% -0.3 Microsoft Sites 9.6% 9.4% -0.2 AOL Network 4.9% 4.8% -0.1 Ask Network 4.6% 4.7% 0.1
* Based on the five major search engines including partner searches and cross-channel searches. Searches for mapping, local directory, and user-generated video sites that are not on the core domain of the five search engines are not included in the core search numbers.
YouTube has come out with a tool to help you answer the question of who's watching you. YouTube Insight is a free video analytics tool that allows users who upload videos to YouTube to track the viewership on their videos including the geographic breakdown by region, as well as the popularity relative to all videos in that market over a given period of time. Uploaders can also delve deeper into the lifecycle of their videos to find out how long it takes for a video to become popular, and what happens to video views as popularity peaks. Another key feature expected shortly is a breakdown of how viewers discovered your video. Using these metrics, you can increase your videos' view counts and improve your popularity on the site. To view your video analytics, click "About this Video" button under "My Account > Videos, Favorites, Playlists > Manage my Videos."
Google has announced that it will be enabling offline access to Google Docs. The planned rollout is expected to happen over the next couple of weeks. Powered by Google Gears - which once enabled, provides the user with a local version of their documents and a list of documents and editors. Features are limited offline; users are able to view and edit. Changes are made via a web browser even when offline and saved locally and when back online, documents are sync'd back up with the server. Offline access is only being provided for docs initially, not spreadsheets and presentations.
Comscore will soon release their report of Google advertising activity for February and Silicon Alley Insider says they already have the numbers that show Google with 515 million US paid clicks in February, up 3% year over year. Unfortunately for Google a gain of only 3% is not very impressive on the surface and is also somewhat misleading because we had 29 days in February this year, which means that ad clicks at Google were flat on a year to year comparison.
The market did not take this click report very well, and Google has fallen over 3% in after hours trading, though tomorrow's trades will tell the full tale of how this information will be incorporated into Google's share price which will open at about $444 tomorrow due to the after hours trading corrections to the close today at $458. This is not as low as the $412 Google has traded at recently but well off Google's 52 week high of $747.
Lacking from these reports however are the revenues obtained from these clicks. Better optimization can yield higher revenues from the same number of clicks, and major changes recently were implemented by Google, effectively elimating many ads that Google felt did not meet their new "quality scores" which reflected higher advertising standards. Thus it is possible that this new approach could actually lead to a "better than expected" revenue outcome for Q1 without more clicks. That said, if the advertising market as a whole is flattening out, Google will be very hard pressed to continue their amazing revenue growth. It is not clear if the current stock price on GOOG fully reflects the pessimism many analysts have expressed about online advertising in the next few years.
Google has recently launched the ability to search within a site from the Google search results page. Smack dab in the midst of your search results, you can be served up a search box to directly search the site you are seeking. The idea is to get you to the exact page on the web site.
Google would now like to help you build websites. The company has now added Google Sites to its Google Apps web office suite which allows end users and businesses to create websites. The was made possible by virtue of their acquisition of Jotspot some time back and the re-tooling of that app into this new site creation tool. Sites allow code-challenged users to build, customize, and oh yes search their websites. Users can centralize all types of information including videos and presentations and share their site with just a few people, across a company, or with the world.
"With only a few clicks, just about anyone will be able to quickly set up and update a Web site featuring a wide array of material, including pictures, calendars and video from Google Inc.'s YouTube subsidiary," said Dave Girouard, general manager of the division overseeing the new application. This is yet another attempt by Google to rival Microsoft Office and Sharepoint in this case. Dan Farber's blog over at Cnet provides this perspective: "Google now has a pretty good and easy web-page creator with some wiki features made user-friendly, and a half-hearted attempt at integrating the rest of the Apps empire using Sites. Perhaps they get it right in the next release."
Andy Beal recently wrote that Google's stock is far from the $2000 a share predicted by Henry Blodget publisher of InternetOutsider. After missing analyst estimates and the announcement of the Microsoft - Yahoo takeover (predicted here), Google's shares (GOOG) have been hit very hard. Larry Page, Sergey Brin, Eric Schmidt and Ram Shriram who own majority of the Class B shares (which control the company) have seen the fortunes drop by US$16 Billion collectively. The Microsoft Yahoo overture shows Google's vulnerability. Over 90% of the company's revenue comes from search advertising. If I ran Google, I would have used the high share value as cheap currency to make acquisitions of web products, tools and services companies that litter Silicon Valley to transition to a provider of multiple web offerings and reduce the dependence on a single revenue stream. Google's market value has dropped US$70 Billion from it's peak - that is a lot of acquisitions.
After the let down of Google's Opensocial attempt, Google has now launched Social Graph API, which aims to be a centralized place which web services can use to access relationships between people. So, how does it work? FOAF and XFN are used to provide information about relationships between people in hyperlinks. For instance, an example of XFN hyperlink would be "<a href="http://jeff.example.org" rel="friend met">" which says that Jeff is my friend. Google's crawler which already indexes links for its search engine, will now also build a social graph. This social graph is then exposed in the form of an API which will be accessible by any third party. And how does Google create a social graph from links? If me and a friend are following each other on Twitter, then it will consider us friends. So, if I visit any third party site and specify that I represent the following twitter account, then that third party site can query the API to tell me that my friend is also using this service presently. Another way is the use of affiliation; that is, I mention my Facebook profile on my blog and Twitter account on my Facebook, then Google's Algorithm will know that all three pages belong to a person named Mayank. Using this (maybe) public information, my public profile is made along with my connections which any third party can use. Of course, this also leads to the possibility of fraudulent information being generated and owned. That is, what is stopping people from claiming that they are Larry Page? Would an equivalent to bombing of search results be possible here? I don't see an answer being offered presently.
Facebook and Google are both part ofDataportability. Dataportability and people indexing can, of course, both co-exist. Though it's yet to be seen in what form these services will be provided and when they will reach an inflection point beyond which a user expects availability of this information everywhere. What we can at least be sure of is that the social graph will be openly offered in the not too distant future which will enable many useful services. Here is a video telling more about Google's attempt.
Google now allows you to associate other email addresses with your Google account. If you sign into your Google account and click on "Edit" next to "Personal Information" you will see the below.
You can only add one email address at a time but what this allows you to do is to associate other information from your other email addresses with your main Google account so information is synchronized. This is useful for things such as appointments which can show up centrally in your Google Calendar if they are sent to any of your other email addresses.
Interestingly, I tried to add another Gmail address and got this message "You can not associate a Gmail address with your Google Account." I tried to add two other non-Gmail email addresses of mine but got "A user with the email you specified already exists" which apparently means 'it's possible that you've already created another Google Account with that username. Someone may have also accidentally entered your email address when creating a Google Account, but hasn't been able to verify email ownership'. Finally, I got a third to work. An email verification is sent to the email address you requested to be added and you can activate it from there.
Want to develop applications for Google's new Android mobile phone platform and make a cool $275K?! Google has put $10M into a competition to do just that. The idea is to develop a lot of original cool apps that are highly functional as well as usable. The apps need to access core Android functionality like location-based services, accelerometer and always-on networking.
The smartphone market is heating up and Google is looking to the development community to create the killer app that's going to make people switch to Android. Apple also recently announced that it will be releasing an iPhone/iPod Touch SDK in late Feb.
Google has made a number of improvements to their Google Apps on the iPhone. Just a month after the launch of its initial version, the Google Apps for iPhone diehards have gotten even slicker. The web applications including Search, Gmail, Calendar, and Reader are now sporting an even more streamlined interface intended to make the applications faster, easier to activate, and improve their overall usability via the iPhone touch-screen interface.
The new features include the ability to customize default tabs for easier navigation, speedier Gmail where new emails automatically appear eliminating the need to do a manual refresh, at-a-glance monthly view of Calendar appointments, and access to and synchronization of iGoogle gadgets on the iPhone. The redesign is intended to provide iPhone users with a desktop-like web application experience optimized for the iPhone.
Google plans to expand this experience to international versions of the iPhone and to other platforms that offer similar usability and browser capabilities. To get the new Google experience on the iPhone, navigate to www.google.com on the iPhone Safari browser.
Upping the ante on personalization, Google is now allowing users to customize and personalize their iGoogle homepage even further. The company yesterday announced the release of the iGoogle Themes API along with a themes directory. The Themes API allows users to either create their own new theme or select from a user-generated one. Users can create a theme and share it with the tens of millions of iGoogle users around the world.
Google Maps has teamed up with The Weather Channel to integrate weather details. So, if you're planning a trip and don't know whether to pack your Uggs or Oxfords, you can simultaneously get the weather information for your intended destination along with the directions.
From Google.com, type a city name, for example, and click "Google Search" and select "Maps" from the top left or from the search results. From Google Maps, click on the "My Maps" tab and check the option for "The Weather Channel" under the Featured Content section. And voila! You get the overall lay of the land and corresponding temperatures. Click on the temperature bubble on the map for your location of choice and out pops the forecast compliments of weather.com. You can also filter your results further for specific weather overlays, points of interests (cities, airports, etc.), and temperature settings (celsius or fahrenheit).
There is a useful video from Google providing tips on how to prevent the indexing of web pages you don't want Google to crawl so it doesn't show up on the web.
In an announcement yesterday, Google, Facebook, and Plaxo joined the DataPortability.org Workgroup. The announcement stated that as key players in the social networking space, "their joint support of the DataPortability initiative presents a new opportunity for the next generation of software - particularly in the fields of social software, user rights and interoperability". The DataPortability initiative is focused on creating end-to-end data portability for which it claims the technology already exists so that "as users, our identity, photos, videos and other forms of personal data should be discoverable by, and shared between our chosen tools or vendors".
Billionaire takeover strategist Carl Icahn is looking at a possible play to force Yahoo back to the table with Microsoft to sell the company at a big profit. The news today sent Yahoo up about 1.30 and YHOO is still rising in after market trading.
DiggIt
Del.icio.us
Stumble It!
Maria Bartiromo at 
Google has been named the world's number one and most powerful brand for the second year in a row clocking in at an estimated value at $85,057 million which represents a 30% increase in its brand valuation. This, according to BrandZ's top 100 brand ranking for 2008. Other tech heavyweights in the top ten included GE, Microsoft, China Mobile, IBM, and Apple which was the biggest mover in the top 10 and a new entrant, moving up from sixteenth to seventh place with an incredible 123% increase in brand value to $55,206 million. HP was at sixteen, Cisco ranked twenty-two, and Oracle and Intel at numbers twenty-six and twenty-seven respectively.
YouTube has come out with a tool to help you answer the question of who's watching you. YouTube Insight is a free video analytics tool that allows users who upload videos to YouTube to track the viewership on their videos including the geographic breakdown by region, as well as the popularity relative to all videos in that market over a given period of time. Uploaders can also delve deeper into the lifecycle of their videos to find out how long it takes for a video to become popular, and what happens to video views as popularity peaks. Another key feature expected shortly is a breakdown of how viewers discovered your video. Using these metrics, you can increase your videos' view counts and improve your popularity on the site. To view your video analytics, click "About this Video" button under "My Account > Videos, Favorites, Playlists > Manage my Videos."
After the 
Want to develop applications for Google's new Android mobile phone platform and make a cool $275K?! Google has put $10M into a 
Google has made a number of improvements to their Google Apps on the iPhone. Just a month after the launch of its initial version, the Google Apps for iPhone diehards have gotten even slicker. The web applications including Search, Gmail, Calendar, and Reader are now sporting an even more streamlined interface intended to make the applications faster, easier to activate, and improve their overall usability via the iPhone touch-screen interface.
In an announcement yesterday, Google, Facebook, and Plaxo joined the 