Microsoft chases Yahoo
[ Special report: The entire Microsoft-Yahoo saga ]
Microsoft's attempts to buy Yahoo generated more speculation, leaks, and pundit pontification that any other story in the tech world this year. Microsoft officially withdrew its bid on May 5 after failing to agree on a price with Yahoo, even though it ended up raising the original Feb. 1 offer of $31 per share, or about $44.6 billion, to $33 a share. In the aftermath Jerry Yang resigned as CEO of Yahoo, which saw its share price sink to $9. After declaring he was no longer interested, Microsoft CEO Steve Ballmer said in early December that the two companies should do a search deal "as soon as possible." Yahoo last week removed one impediment to a deal that Yang had erected: a controversial severance plan. Ultimately, much more than a price tag is at stake. Google is using the cash generated by its dominance in Internet search and advertising to develop new services and applications that diminish Yahoo's importance and challenge Microsoft in the market for software as a service. Look for the saga to conclude with a deal, sooner rather than later.
OOXML scores controversial victory
Microsoft declared victory in its fight to get fast-track approval for Open Office XML as a global file format standard on April 1. Some critics said it was ironic that the software giant crowed about its success on April Fools' Day, given that a vocal group of International Organization for Standardization members had complained about irregularities in the voting process. Industry insiders said the whole affair smacked of the days before antitrust cases in the United States and Europe when Microsoft could throw its weight around and skirt the boundaries of the law with impunity. Others said that the OOXML approval means life will be more difficult for IT managers who want to use applications incorporating the rival Open Document Format standard. The ultimate significance of the whole affair may be that in its fight to get OOXML approved as a standard, and subsequent efforts to make the file format more interoperable with other document formats, Microsoft has signalled that it understands that the software market has changed. As Web and open source applications become increasingly important, even proprietary software giants need to make sure their APIs and file formats are transparent and connect to the wider world of software.