Michael Robertson has something interesting to say about the Microsoft-Yahoo merger, still on hold, but likely, in the view of many observers, to eventually be consummated.
Robertson is a pretty sharp guy. He founded MP3.com, which was bought by Vivendi Universal for a whole boatload of money in 2001, right before the dot-com crash. He founded Linspire, a flavor of Linux with a user interface that was inspired, if that's the word, by a very familiar one. I won't say which, except that the software's original name was Lindows, which I mention mainly to retell one of my favorite comments ever by a federal judge. When Microsoft sued Robertson's company over the name, U.S. District Judge John Coughenour said,
Although Lindows.com certainly made a conscious decision to play with fire by choosing a product and company name that differs by only one letter from the world's leading computer software program, one could just as easily conclude that in 1983 Microsoft made an equally risky decision to name its product after a term commonly used in the trade to indicate the windowing capability of a GUI.
Anyway, here's what Robertson has to say about the merger, predicting Microsoft's eventual success.
Both companies are getting trounced by Google in search, but there's more to the world then just search. Yahoo has enormously valuable net assets which, when combined with Microsoft, will create a giant in several areas. One example is IM (instant messaging).
Many may be surprised to learn that Microsoft's IM network is now more than twice as big as anyone else and Yahoo has moved past Granddaddy AOL into second place. If Microsoft and Yahoo combine their IM networks (which are already interconnected) it would be multiple times bigger than anyone else.
In other words, if you're on MSN Messenger, you can add Yahoo Messenger contacts, and vice versa.
Robertson has a particular thing for instant messaging, because his latest project is something called Gizmo5, which is an interoperability program for instant messaging and voice over Internet-protocol. (In fact,it might be fair to say that the IM is a freebie to attract users to Robertson's Skype-like VoIP offering). Robertson has a nice little chart delineating which IM programs are already interoperable with which others. For some reason, the chart doesn't have a row for Meebo, a Web-based IM program that lets you manage, and IM, from all your different accounts, whether they're multiple accounts on one IM platform, or across several platforms, including AIM, Yahoo, Google Talk, and MSN.
I have a particular thing for IM as well, having written about it several times, including an article last month that looked at IM on cellphones ("IM Doing Fine"). But Robertson's comments go beyond IM. Generally, analysts aren't looking for these sorts of inner compatibilities between the companies, and that's a shame, because ultimately the success of a merger, and whether it makes business sense, stands or falls in large part on such considerations. I'll have more to say about that in a future post.