Microsoft's bid Failed:
Microsoft Corp.'s decision to drop its pursuit of Yahoo! Inc. increases the pressure on
Chief Executive Officer Steve Ballmer to make his money-losing Internet business succeed
against Google Inc.
Ballmer and Kevin Johnson, president of Microsoft's Internet unit, met two days ago in
Seattle with Yahoo co-founders Jerry Yang and David Filo, two people familiar with the
negotiations said. Redmond, Washington-based Microsoft, the largest software maker,
offered to raise its $44.6 billion bid by about $5 billion, to $33 a share. Yang and Filo
refused to accept less than $37 a share, the people said.
Google gained 10 percentage points of market share in Internet queries since June,
providing 59.8 percent of the searches done in March, according to researcher ComScore
Inc. in Reston, Virginia.
ABOUT MICROSOFTS BUYS:
Microsoft has spent $7.5 billion on its Internet unit over the past 2 1/2 years,
estimates Matt Rosoff, an analyst at Kirkland, Washington-based Directions on Microsoft.
The online services business lost $745 million last fiscal year as Google outsold
Microsoft in Internet ads by a 7-to-1 margin.
The company released its AdCenter Internet-advertising service two years ago to challenge
Google with a program that targets ads by age, gender and location. Microsoft also bought
Seattle-based AQuantive Inc. in August for $6 billion to gain tools that help advertisers
track the success of their marketing efforts.