If Microsoft's $44.6 billion hostile takeover bid for Yahoo is successful, sifting through their duplicate business services and deciding what stays, what doesn't, and what changes will become a necessary exercise. Yahoo last week continued to fend off Microsoft and explore its options. The Wall Street Journal reported midweek that Yahoo was in talks with News Corp. about a potential business arrangement that would negate Microsoft's come-on.
Yahoo-owned collaboration suite Zimbra, which includes e-mail, calendaring, unified messaging, and document collaboration, has big-name customers such as Century 21 and Raytheon. Zimbra is an example of Enterprise 2.0 online tools, which Microsoft has been slow to deliver. But Zimbra is based on open source code, and it competes with Microsoft's lucrative SharePoint, Exchange, and Office apps. So while Zimbra would fill a gap in Microsoft's line, it also could present some hard decisions. Microsoft could pluck off the best pieces of code and integrate them elsewhere, let Zimbra die a slow death, or keep it alive and independent.
ASSESSING PARTNERSHIPS
Yahoo provides small-business Internet access in partnership with AT&T, which Microsoft would likely continue, although it's unclear under which brand. Yahoo also owns a large stake in Chinese e-commerce site Alibaba.com. Microsoft has said it will keep Yahoo's relationships with Asian affiliates alive.
Microsoft CEO Steve Ballmer intends to keep Yahoo's brand intact, yet he envisions $1 billion in annual savings from "synergies." If the deal happens, tough choices will follow.
In the area of enterprise search, Yahoo and IBM have a co-branded search product, but Microsoft's Search Server trumps it in terms of security and relevance to business search, since it's tied to SharePoint Server. Because Microsoft competes with IBM, it wouldn't be surprising to see Microsoft scratch that deal and shift Yahoo customers to its technology.
How Yahoo's Small-Business Services Compare With Microsoft's
Product
Yahoo
Microsoft
The Rub
Search
IBM Omnifind Yahoo! Edition
Microsoft Search Server 2008 Express
Microsoft has better security, more business relevant tech
Web hosting
Yahoo! Small Business Web Hosting
Office Live Small Business
Yahoo offers unlimited storage, but Microsoft's free
E-Commerce
Yahoo! Small Business Merchant Solutions
Office Live Small Business, Commerce Server
Yahoo has a respected online store service
Custom domains
Yahoo! Small Business Domains
Office Live Small Business, Windows Live Admin Center
Duplicate services are both like GoDaddy
E-mail
Yahoo! Small Business Business Email
Office Live Small Business, Exchange
Microsoft's cheaper for larger companies
Search marketing
Yahoo! Small Business Search marketing
Office Live Small Business, adManager, aQuantive
Execs have talked of combining Microsoft and Yahoo search/ad capabilities
Internet access
AT&T Yahoo! High Speed Internet
None
ISPs represent co-branding opportunity
Collaboration
Zimbra
Office Live Small Business, Exchange, SharePoint, Office Live Workspace
Open source Zimbra a tough fit at Microsoft
E-commerce, small biz apps and collaboration
Alibaba.com
Office Live Small Business, Commerce Server, Exchange, CRM Live, Office
Accounting Express 2008
Chinese e-commerce site gives Microsoft new in in developing world
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