“If you’re a Microsoft shareholder, you shouldn’t be wondering whether CEO Steve Ballmer overpaid for Skype,” Evan Newmark writes for The Wall Street Journal. “That’s a waste of time. Of course, he overpaid.”
“Here’s a much better question: why is this man still CEO?” Newmark wonders. “That’s just how bad this deal is.”
“It’s one thing for a CEO to convince himself that a deal is ‘strategic’ – even if he’s buying a money-loser with no proprietary technology and no viable business model. But it’s another for him to bid against himself and end up forking over $8.5 billion in cold cash to buy said money-loser – three times what it fetched a year and a half ago,” Newmark writes. “That’s unforgivable.”
Newmark writes, “Why the Microsoft board is happily going along with this folly is a mystery to me. Then again, this is the same board that blessed Ballmer’s profligate $48 billion bid for Yahoo. Such is the fate of a company with too much money, too few good ideas and a share price that can’t break $30.”
“With Skype, Ballmer isn’t just guilty of poor timing or overpaying. It’s worse. He’s guilty of putting Microsoft into a position where it is compelled to buy companies like Yahoo and Skype that nobody else really wants,” Newmark writes. “Microsoft’s board would be doing its long-suffering shareholders a favor by making this dumb deal Ballmer’s last.”
Read more in the full article here.
MacDailyNews Take: Here’s hoping that Microsoft’s board and shareholders remain in their collective stupor and continue to leave Ballmer “in charge” for as long as it takes.
[Thanks to MacDailyNews Reader “Fred Mertz” for the heads up.]
Related articles:
Ballmer: Microsoft won’t drop Skype support for Mac, iOS – May 10, 2011
Microsoft’s Ballmer reportedly tricked into overbidding for Skype by $4.5 billion – May 10, 2011
Skype releases patch for zero-day vulnerability in Skype 5 for Mac – May 10, 2011
Microsoft + Skype = $8.5 billion thrown into a bonfire – May 10, 2011
Microsoft buys Skype for $8.5 billion; company’s largest-ever acquisition – May 10, 2011
For as long as it takes. Long live Ballmer!
Another fine strategic move on the Microsoft path to obscurity. We couldn’t script it any better. Keep dancing, monkey boy!
Long live Ballmer!!! I remember when I first saw that quote I was a believer but needed proof! A year later, this stooge has proven himself to be clueless more times than I can count! Hopefully, he’ll be in charge for a few more years to see Apple fully gut them & the rest of these copy-cat companies!
By the year 2020, nobody will remember what Micro$haft was. It will be the year when IT regains perfect vision — 20/20, get it?! 😉
On the road to 2020, stars are aligning.
I’ve said this before – by 2020, Microsoft will be like IBM is today. Still around, still big, but not what they used to be. IBM is still important in corporate back office stuff. So will Microsoft. MS will not be in much user facing software. However, I believe they will remain as “The Office software company”.
Or to use SJ’s analogy, by 2020 Microsoft will be like a truck. Some people will need it and use it, but most will have no need and won’t use it.
Ballmer ought to join the Google board. Someone make it happen.
8.5B for Skype, and it doesn’t even have a keyboard, which makes it not a very good email machine.
LOL — beautiful. =)
THAT was incredibly funny! Thank you- you made my day!!!
I’m pretty sure Ballmer works for Apple.
One could come to that conclusion.
Let’s hope that down the road Apple is able to maintain the edge, the vision, and the quality of leadership rather than devolving into what Microsoft has become.
On the other hand, I don’t believe that at its zenith that Microsoft ever was comparable to what Apple has become. Money can’t buy everything.
Only Mac Heads think this is a terrible deal… anyone else in the industry thinks its a great investment/idea for Microsoft.
Ps MDN how is that retooled App coming along? “Be Back Soon on Feb 2nd…” It’s now May 11! That’s 3 months to retool???? Epic fail!
And that’s why MSFT has been selling off since the deal became known…
Really? Just “Mac Heads”?
http://arstechnica.com/microsoft/news/2011/05/microsoft-confirms-85-bn-skype-purchase-clarifies-nothing.ars
or Reuters:
http://in.reuters.com/news/video/story?videoId=209398008&videoChannel=104
or how about the Wall Street Journal?
http://blogs.wsj.com/deals/2011/05/11/mean-street-8-5-billion-reasons-to-fire-steve-ballmer/
Marco, your illiteracy must be astounding.
Within 15 seconds, I found articles panning MS- From the BBC to the Wall Street Journal- All questioning MS’s sanity over this deal.
Only MS heads think this is a good deal… anyone else in the financial world thinks it’s a terrible investment/idea for Microsoft.
That’s true. I would assume that those who actually think this is a good deal are either hacks or MS heads. As we know, there are a lot of idiots, heads, and hacks out there.
Marco, you are absolutely right. These stupid Macheads justs don’t get it. Given that SKYPE is likely worth $3.5 – $4 billion, there are only 4.5 BILLION reasons to fire Balmer. But, who’s counting. Hopefully not M$ shareholders.
Epic Looser!
Not very tight?
They spell loser different in Canada. Sort of like a semi in the U.S. is a transport there.
Canadian here. Never seen “loser” spelled “looser”.
Unless there’s some sort of sarcasm I’m not catching. I’m still half asleep.
OK then this. Looooooooser.
Get it now.
“Ps MDN how is that retooled App coming along? “Be Back Soon on Feb 2nd…” It’s now May 11! That’s 3 months to retool???? Epic fail!”
So frakkin’ true. And unforgivable. And microsoftian. Who is running their app, anyhow?
Yeah, even the white iPhone 4 beat the new MDN vaporapp. MDN was too busy pointing the finger, leaving only one hand to work on the mobile app… until they developed an itch on their behind — at which time all work on the app stopped.
You sound like the little net nerd i am scared my kid could become. Epic Fail? Have you ever had an original thought?
Next he will call me a Hater. lol.
What is truly amazing is that the original creators of Skype STILL own a sizable chunk of the IP!
What the hell is Balmer doing?
Is that true? I heard rumours to that effect, but could Ballmer really be so stupid?
Is that a rhetorical question? The answer seems quite obvious to me
If I were mobile operator, Verizon, AT&T, Sprint, T-Mobile, I would stop carrying Windows 7 phone. Why would I help another mobile service provider (Microsoft w/ Skype) to beat myself? By by, Windows phone. And by by, Nokia.
After verifying Nimbuzz handled international dialing to my satisfaction, I trashed Skype this morning.
Okay, I only spend $100.00 @ month dialing Great Britain, but that’s $1200 of my money being put where my mouth is
8,500,000,001
Cause he’s a fat moron
Rounding error.
Simply put and funny as hell. Thanks for that unexpected laugh
C’mon now. “Fat” is hitting below the belt, even though you can’t see it for the…. er…. fat!
Ballmer goes to the doctor: ” Doc, I gotta get rid of this gut, when I take a leak I can’t even see my penis. What do I do?”
Doc: ” Have you tried to diet?”
Ballmer:” Why, what color is it now?”
*snort*
Guess MSFT will now buy Sprint so it can insist a carrier sell its Win phone.
Or maybe the strategy is to have users only buy data plans and use Skype.
Or maybe Ballmer has just gone insane.
I really wish these financial reporters would stop criticizing Ballmer.
All this disparagement could get him fired.
Ballmer can get the job done. He just needs a little more time.
A. little. more. time.
Yeah. I like your strategy. I like it A LOT.
But he may need years and years and … aahhh …. yes,
he needs as much time as it takes.
FALAIT!
Please! Keep down the anti-Balmer chatter and support the man doing a tough job. Think of Bill Gates, first having to read about Paul Allen’s book which portrays him as control freak ready to screw a sick partner. Now, he has to endure a floundering stock price and see his trusted successor ridiculed in the trade press. Let’s cheer them all up with more optimistic scenarios of how this could all come out well. I predict Ballmer’s marketing genius will have real buttons back on phones, phones that will only work on Skype, and the Drudge Report will fade to obscurity with Yahoo providing all our news by linking its research to Bing. Microsoft will be trading at $230, not $30, and Bill Gates will be spending billions on mosquito spray in West Africa. The world will live at peace.
In the WSJ articule, it mentions Goldman Sachs as Skype’s agent in this deal. That explains it all for me. Ballmer got Played, Big Time.
What is Apple going to buy when MS breaks up?
And the answer is…virtually nothing.
So, let’s see… is Balmer trying to compete with CERN??? Is his strategy to build a bigger black-hole that the LHC, so it can suck Micro$haft, Nokiasoft AND Skyper-shaft into the vortex of slime all at once?? Sure looks that way…. 8.5 billions reasons to dunk Balmer in a pit of lava should be enough, but Micro$haft shareholders OR board members never were the brightest lot in the park..
On a serious note, are there any viable replacements for SKYPE that can handle IM, VOIP and screen sharing? This is not a joke…I just don’t get out much and I EFFING hate M$.
iChat does enough for me.
How Ballmer single-handedly bankrupted Microsoft. This should be an education to us all.
Never put your entire global corporate empire in the incapable hands of a fat slob salesman.
Hey…watch it!!! He’s no salesman….
“… Why is this man still CEO?”
Shhhhhhh! Dammit. Some paid troll hanging around here is going to tell his boss and BLOW EVERYTHING! Folks, we have GOT to KEEP this a SECRET! 😡
Here’s an unpleasant thought – you know how Skype has, up to this point, been refusing to install “secret” government backdoors to allow eavesdropping and wiretapping?
…yeah, pretty sure the new ownership will bring that refusal to an end pretty quickly.
Still, on the plus side, think of all the “presidential alerts” Skype will soon be able to deliver!
NO!! Ballmer MUST STAY! Shut up! We may need to start an e-mail campaign to keep Ballmer as CEO.