Buying on the rumor; selling the rest of the time

nasdaq.jpgYahoo’s stock price was rescued (yet again) by rumors that Microsoft is getting ready to bid for the web company’s search business (yet again).

The shares had looked set to fall below $19.18 on Wednesday — the level they stood at on January 31 before Microsoft first announced a takeover bid for Yahoo. But thanks to a report in the Wall Street Journal, Yahoo shares jumped about 6 percent in electronic trading early in the morning.

If this reversal of fortune sounds familiar, it should. These days, Yahoo’s stock seems more likely to rise on speculation about possible deals than anything having to do with its actual business. Check back on a MediaFile posting from June 24 that points out Yahoo shares jumped 15 percent after TechCrunch reported that it was back in takeover talks with Microsoft.

Here’s what the Wall Street Journal is saying about the latest talks:

“Microsoft Corp., positioning itself for a new run for Yahoo Inc.’s search business, has approached other media companies in recent days about joining it in a deal that would effectively lead to Yahoo’s breakup, say people familiar with the discussions.

Microsoft has held discussions with Time Warner Inc. and News Corp, among others, say people involved in the talks.”

Who will run Yahoo?

yahoo-sign.jpgWho’s going to run Yahoo?

There are myriad answers to that question, but AllThingsD suggests that Ross Levinsohn, the former head of News Corp’s Fox Interactive Media Group, and partner, former AOL Chief Jon Miller, are heavily mentioned as the kind who might get a crack at it.

Miller’s an interesting choice and one wonders if joining the company would push Yahoo closer to an AOL deal. Miller wasn’t immediately reachable on Monday night.

Meanwhile there’s no guarantee that Jerry Yang, who is still in charge, is going anywhere. In fact, on Monday, Yahoo itself worked to rally shareholder support in the face of a proxy battle with Carl Icahn, saying the his plan for the company’s future was “ill-defined”, and questioned whether Microsoft was ever serious about a full-scale merger.

Gates/Ballmer – Saying goodbye is hard to do

Gates and Ballmer (Matrix)All good things have to come to an end. Even a stroll down memory lane. Final stop: proudest achievements and biggest screw-ups.

What was your proudest achievement?

Gates: We changed the mindset that software was this unimportant thing and (how people thought) about computers in a certain way. I think that was our most important thing.

Ballmer: The guy has a lot to feel good about. Just think about the number of things that have happened. There was no software industry. Now, there is a software industry. There was no personal computer. Bill was really there at the birth of the modern personal computer. Bill really designed the IBM PC. That’s my non-revisionist history.

Microsoft’s Bert and Ernie

bertandernie.jpgBill Gates’ retirement from Microsoft Corp was an opportunity for him and Chief Executive Steve Ballmer to espouse on their decades-long partnership. Here are some excerpts from their Town Hall meeting with Microsoft employees on Friday.

On how they met:

Gates : Steve and I were both at Harvard and I was in this dorm up at Radcliffe where the kind of anti-social math types hung out … I was energetic and had ideas. There was a guy who would hang out with me who also knew Steve and he kept saying “There is this other guy who is super energetic like you and he’s a neat guy.” So … we went out to the movies together. I think we saw right away that, even though we are different in some ways, we had a lot in common and from that day forward, we brainstormed about our dreams, what we wanted to do and that was fantastic.

Ballmer: So we went out to see this movie. It was a double bill. ‘Singing in the Rain,’ which is my favorite movie ever. I’ve seen it now 30 times … We come back from the movie and we’re dancing, playing Gene Kelly and some guy wrestles me to the ground. Bill is trying to beat him away. It was really a weird kind of place.

Bill Gates reminisces about Microsoft

Bill Gates bid an emotional farewell to Microsoft on Friday, the company he co-founded in 1975. Here are some of his quotes, filed by Reuters reporter Daisuke Wakabayashi, who was at the event at the software giant’s leafy Redmond, Washington, campus.

Albuquerque Group

Gates on starting Microsoft:

Microsoft is one of the few companies you can say it just started with a dream. A dream that software would be important. A dream that there would be a computer that was affordable on a personal level. That’s a dream that Paul Allen and I had, which at the time seemed very crazy.

Gates on IBM:

Our relationship with IBM was one of the defining things in this company. We were their partner. At some point, they chose not to have us quite as much of their partner. They went off with OS/2 and we were left with good old Windows. Sure enough, the David vs. Goliath story came out with the right ending.

Battle of egos at Yahoo, Microsoft

Yahoo shares have fallen 20 percent since talks with Microsoft broke up, and some shareholders are blaming big egos for the failure.

Robert Hagstrom, a portfolio manager at Legg Mason Capital Management, the third-biggest institutional shareholder of Yahoo, said the only way to try to catch up with Google is to put Microsoft and Yahoo together:dynasty.jpg

I thought the dynamic was great. Unfortunately, personalities got involved, egos got involved and that I think disrupted negotiations. I was shocked, shocked that Microsoft walked away.
Microsoft’s problem is that 80 percent of its business is going to go away one day… Microsoft has to figure a way to get a lot of eyeballs. Well, who’s got the most eyeballs after Google? Yahoo. I didn’t see why this couldn’t go together.

Microsoft, the $250 billion underdog

Microsoft may be the behemoth monster 800-pound gorilla of software, whose Windows and Office products are nothing short of Golden Gooses. Or Geese. Or whatever.Video: Bill Gates last day at Microsoft

But it’s interesting to hear how its leaders view themselves. To hear Chief Executive Steve Ballmer talk about Microsoft, you might think it is still the underdog startup it was 33 years ago when Bill Gates and Paul Allen started the company . Or the sapling it was when Ballmer joined in 1980.

People are underestimating Microsoft. Yes, we make mistakes, but we come back and learn from those things.

Oh Mr. Gates, how the time flies!

Paul Allen (left) and Bill Gates Oct. 19, 1981


Microsoft (then spelled “Micro Soft”) is founded by William “Bill” Gates, a 20-year-old Harvard dropout, and Paul Allen, his 22-year-old school chum. They begin selling its first product, a BASIC programming language interpreter.

1980The IBM Personal Computer (1981)

Microsoft signs an agreement to build the operating system that became known as MS-DOS for IBM’s new personal computer, which was launched in 1981. Microsoft was allowed to license the operating system to others, spawning an industry of “IBM-compatible” machines dependent on Microsoft software.


February: Paul Allen, ill with Hodgkin’s disease, resigns from active management of the company but remains on the board of directors.

A primer on Bill Gates

gates1.jpgOh, by the way, you may have missed it, but today is Bill Gates’ last day on the job at Microsoft. 

For good reason, there has been no shortage of coverage today with reporters covering every angle of the story.

A good deal of the writing has focussed on Gates’ legacy over the three decades he ran Microsoft.

Microhoo: reading the tea leaves

tea.jpgWith Yahoo shares trading just above $20, investors must be desperate for any sign that buyout talks with Microsoft could be resuscitated. It’s been relatively quiet since Yahoo struck the Google ad deal — with nary a peep from the usually loquacious activist investor Carl Icahn, who has been blogging about CEO pay but keeping silent on where he will take his Yahoo proxy battle.

So it’s no surprise that Yahoo shares jumped as much as 15 percent on Tuesday after TechCrunch reported that Microsoft and Yahoo are back in takeover talks, citing multiple sources at both companies.

But investors’ hopes were short-lived with CNBC quickly knocking down that rumor, saying its source thinks there are no new negotiations between Microsoft and Yahoo.