Microsoft Bids for Yahoo!—Again!

Microsoft made a $44.6 billion purchase offer to take over search engine Yahoo! on February 1. If approved, the move would certainly shake up Wall Street and the mobile and Web search space, but will likely have little effect on the speech industry, as Yahoo! had only expressed a passing interest in voice technologies to this point.

Sunnyvale, Calif.-based Yahoo! last June identified voice as a consideration in looking at ways to enhance its oneSearch mobile search offering, but the world’s #2 search engine provider has yet to make any significant headway in launching a voice-based service. "I’m not aware of anything that Yahoo!’s doing with speech," says Jim Larson, an independent consultant and VoiceXML trainer, "so I can’t see this having much of an effect on us."

"Microsoft already has a lot with speech and Tellme, so it shouldn’t factor into this," adds Nancy Jamison, principal at Jamison Consulting.

Voice capabilities were the driving force behind Microsoft’s takeover of Tellme Networks last year. Its move to acquire Yahoo!, though, really seeks to capitalize on the very lucrative online advertising market, which is currently valued at about $40 billion and expected to double by 2010. Together, the combined companies would make a more formidable adversary to Google, which has a commanding 58.4 percent stranglehold on the U.S. search market—followed by 22.9 percent for Yahoo! and 9.8 percent for Microsoft, according to Internet traffic tracker comScore.

Bringing Microsoft and Yahoo! together "would enable us to jointly deliver a broad range of new experiences to our customers that neither of us would have achieved on our own," Microsoft Chief Software Architect Ray Ozzie said in a statement.

For Microsoft, this is not the first time it has made advances on Yahoo! The most recent took place last May. At the time, Yahoo! rebuffed Microsoft’s offer, citing a projected turnaround after several operational changes. This latest offer is more likely to be accepted, analysts say, because Yahoo!’s competitive situation has not improved. In fact, Yahoo!’s earnings last year fell below Wall Street’s expectations and the company earlier this week announced plans to lay off 1,000 employees by mid-February, according to published reports.

SpeechTek Covers
for qualified subscribers
Subscribe Now Current Issue Past Issues