Microhoo: the Circus Is Back in the Enterprise Software Ring Thanks to Google


In the whole six months of Microsoft vs. Yahoo vs. Google, I posted only one opinion. On the day the Microsoft bid was announced, I said I would like to see Ray Ozzie of IBM/Microsoft/Notes and Scott Dietzen of BEA/Yahoo/Zimbra on the same team for the sake of better collaboration software for the enterprise.


Other than that, it was too much of a circus to give an informed opinion, and because it is primarily a personal software thing, the deal didn't mean that much to IT staffs and management anyways. In theory, Microsoft could use some of Yahoo's search technology to make its enterprise products better, but that was a small side aspect of the proposed arrangement.


Now Google's SEC filing about the extremely decreased value of its investment in AOL puts the clowns back in the enterprise software ring. In its 10-Q filing with the SEC, Google said:

"We review our investment in AOL for impairment in accordance with FSP SFAS 115-1, The Meaning of Other-Than-Temporary Impairment and Its Application to Certain Investments ("FSP 115-1"). Based on our review, we believe our investment in AOL may be impaired. After consideration of the duration of the impairment, as well as the reasons for any decline in value and the potential recovery period, we do not believe that such impairment is "other-than-temporary" at June 30, 2008 as defined under FSP 115-1..."

The reason this action by Google is related to enterprise software is because Google's estimate of AOL's value sort of officially devalues Yahoo just as much as the market unofficially devalued it after Microsoft withdrew its offer (or let it expire; I forget which).


I think this means Yahoo will simply decompose and disappear (in which case pieces can be acquired by Microsoft) or Yahoo will actually be acquired by Microsoft as originally planned but at an even lower price. Therefore IT may yet see some of the search functionality from Yahoo showing up in Microsoft enterprise software and Dietzen/Ozzie may still become a team for collaboration.