Microsoft, Yahoo, and Micro-Hoo and what it all means for Google
I think everyone is missing the point of the Yahoo-Microsoft deal. Most people have forgotten Novell, except the people in Provo, UT still reeling from the destruction of the Microsoft machine, and of course, Eric Schmidt, CEO of Google. Eric Schmidt took over the reins at Novell in March 1997, when Microsoft was outselling Novell’s Netware Operating System 9 to 5, certainly the decline of Novell’s once 90%+ share of the Network Operating System to just about nothing today should not be lost on the folks over at Google.
The more things change, the more they stay the same. In the early 90’s Microsoft was almost unheard of in the corporate server universe. In fact, many people, analysts included wrote-off Microsoft’s endeavors as a serious player in the Server OS world when compared to Novell or even IBM. Just as many analysts are saying Microsoft does not understand internet advertising today, many of those same company’s where those analyst came from said Microsoft did not understand Server OS. Sound familiar? Today we all know who won that the Server OS battle. Now Microsoft has 8.4% share with Bing, soon to be 28% as Micro-Hoo (also known from this point forward as Bing.) First some history, when Microsoft went up against Novell, their Server OS market share was less than 5%, then it was 10%, then before you knew it, 90%. Microsoft has captured market share in the Internet search arena much faster than it did the Server OS arena.
I believe Sergey Brin chose Eric Schmidt because of his experience going up against Microsoft with Novell. Except, he lost that battle, just as he will lose the battle with Microsoft over Search. Microsoft’s power in the marketplace must not be overlooked or under-rated. As we read more and more about how much Microsoft has spent on Internet search without making any money, just watch who wins in the end. Microsoft’s capture of Yahoo’s market-share for essentially no investment is an amazing feat of negotiation, not unlike Bill Gates original negotiations with IBM for the “rights” to DOS.
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