Microsoft Writing Off Nearly All of the $6.3 Billion it Paid For aQuantive

Ok I'll bite. Skype isn't and won't be a bad investment. It is installed on most peoples computing devices(computer,mobile,tablet), it really doesn't have any good competitors(maybe google voice), it's used heavily in business world for conferencing, virtual numbers and internal comms, it has a nice technology stack which a few companies were eyeing (fb,google).

Really it's amuch better investment then spending a billion on a revenue less image sharing site or a corporate social network provider.

Ballmer like most other CEO's up there is playing a completely different game than the one startups play.

Microsoft is so far doing just fine with Ballmer.

Microsoft bought aQuantive as a knee-jerk reaction to Google's acquisition of Doubleclick. It was comical at the time because

- aQuantive's Atlas was a distant number 2 to Doubleclick's DART in terms of ad server market share

- aQuantive had no plans to create an ad exchange, nor did their market share make that a credible possibility, and

- Microsoft somehow paid twice as much for aQuantive as Google paid for Doubleclick.

All told it was a bewildering acquisition. Either Microsoft didn't understand why Google bought Doubleclick, or Google corpdev did a masterful behind the scenes headfake with regards to the value of aQuantive.

Yahoo at least understood what the DCLK acquisition was about and bought Right Media. Of course, an open ad exchange is basically at odds with Yahoo's premium inventory direct sales strategy, so it has been difficult for Yahoo to really make it successful.

In the end the whole episode was a giant win for Google, and an embarassment for MSFT and YHOO.

Just for an interesting comparison:

Top 100 mining companies in the world:

You'll note that even BHP only hits ~$200bil.

http://www.mineweb.com/mineweb/view/mineweb/en/page67?oid=95...

These are companies that fundamentally provide the materials for our societies.

Shall we change into energy?

ExxonMobil is top, at roughly ~ $300bil

http://www.platts.com/Top250Home

This is a company that powers the modern world.

~ $6 bil for this, $8 bil for Skype, $100 bil for FB is nothing more than Peter-Pan land.

aQuant was MS attempting to get Google to move on some issues, and an attempt to monetise chewing the cud. Skype was MS attempting to control P-2-P interfacing - which will probably succeed (and wasn't ever designed to be monetised) FaceBook was attempting to give the proles the same inherent networking architecture that the elites always enjoyed, and the $100bil is a pay-off for reshaping the world

Hint: mining & energy deal in reality. Tech stocks deal in 'societal value' [where said value is not value to the consumer, it is value to the code controllers; "if you're not paying for it, you're the product"] and are largely to do with the cost of control.

$6 bil in this case means nothing, because MS made billions from nothing.

"It's worth a punt". Translation: if you spend $100 bil on liquidity per day, $6 bil is a joke. Remember: Gates has spent $18 billion on "African circumcision to prevent AIDS" already, and the US government spends that in a month on foreign military adventures (both aggressive and passive).

~

It was worth a punt. Google turned out to be aggressively competitive, however (and let's not mention the top three AI specialists who committed suicide in the year Google launched their algos... ok?)

Be seeing you.

Beat you: http://news.ycombinator.com/item?id=4190965