Yahoos Hate AOL Deal, But Too Scared To Tell Jerry

Kara Swisher called up a half-dozen of her senior Yahoo (YHOO) sources and asked them what they thought of Yahoo's new merge-with-AOL-to-escape-Microsoft-plan (MSFT). In short? They hate it. Unfortunately, they're too scared to tell Jerry:

Kara: Yahoos "consider the Time Warner property slow-moving, weak in technology and saddled with a largely dispirited staff."

Senior Yahoo 1: 'We have enough problems without getting theirs, which are much worse. No one here, except Jerry and the board, has any enthusiasm for it.'

Senior Yahoo 2: 'I cannot believe they would put our amazing assets with those who we don't really respect, for the most part, and think that's okay.'

Senior Yahoo 3: 'Look, Microsoft would not be my first choice [as a merger partner] either. But AOL is not even my third.'

These senior Yahoos had lunch with Jerry yesterday, Kara says , and talked about how to calm their frazzled troops ("We're exploring all our options.") But beyond that, they apparently just discussed food and weather. So, hopefully Jerry's reading Kara.

Oh, and the senior Yahoos are sick to death of all this dickering. They're apprehensive about working for Microsoft, but better to work for Microsoft than be stuck forever in deal purgatory:

'We are tired of all the noise and the angling [of this takeover] and most of us just want something to get done this is completely distracting for employees and makes it hard to manage the big businesses we all have.'

Yahoo Board To Meet Friday, Not Decide Anything

Yahoo's board is meeting again on Friday, the WSJ says (YHOO). But they won't be deciding anything. Decisions may come next week--when the AOL (TWX) and Google (GOOG) negotiations are farther along and there's still a week and a half left on Microsoft's clock (MSFT).

Other nuggets from the encyclopedic report by KEVIN J. DELANEY , MATTHEW KARNITSCHNIG and JESSICA E. VASCELLARO:

• "Many" Yahoo insiders still think selling to Microsoft is the most likely outcome (so do we). Jerry probably isn't among them.
  

• The Yahoo board will talk about the AOL merger plan, but some Yahoo shareholders have reportedly already dissed it (Legg Mason's Bill Miller, for one, is on record saying he thinks there really are no Microsoft alternatives). The AOL valuation under consideration is $10 billion, which seems fair.
  

• Microsoft insiders pooh-pooh the idea that t hey'll do something with News Corp. They don't need Murdoch, they say (and they're right). And Murdoch's only talking to them because Yahoo refused to value MySpace, et al, at $10-$15 billion (thank goodness).
  

• If Microsoft did end up doing something with News Corp, they would probably cut Yahoo in half: Microsoft would take the "search and advertising technology, while News Corp. would control everything else, including Yahoo's broad array of online media properties." This would "allow Microsoft to focus on the software and technical underpinnings of online services while offloading content and information -- historically weak points for the software company -- to News Corp., which specializes in that realm. "All Microsoft cares about is search and the ad engine," one person familiar with the situation said."

• News Corp. desperately wants a seat at the table because some execs think MySpace's growth has peaked (translation: they want to dump it while they can). Some also believe that, despite Murdoch's denials, he wants out of Google deal.
  

Subscribe with an RSS reader Older News Archive Add news to your web site