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It’s about the price… News Corp is in… News Corp won’t play… Microsoft will destroy Yahoo…Yahoo isn’t worth more than what’s offered. 

There’s been so much commentary on the proposed mega merger, it borders on overwhelming.  Anyone with an inkling of insight on tech and an opinion is weighing in while we all wait for the next dose of fact to supplant innuendo.   While I wait, one wonder keeps hitting me: is Microsoft’s collective head in the cloud?

That phrasing may sound odd but it’s not a typo.  It is meant to be just one cloud – as in the so named concept of Cloud Computing. 

As much as web traffic and advertising dominance make an approachable, and rational, near term justification for this deal.  There’s also a longer term vision; something more in Microsoft’s strategic vision.    Cloud computing, as esoteric as it sometimes seems, could be part of it.  Research, sound bytes from the executives themselves and a deeper look into just what this vague concept of computing actually means seems to make for a logical argument:

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Tech Crunch is reporting what’s left of digital music wholesale service Snocap has been sold to the Web 2.0 social music service Imeem.  A formal announcement, they report, is coming later in the week.(UPDATE: It took months not weeks for an official announcement but as of April 7, 2008, the news is now official. See the bottom of the article for updated terms)

Snocap, which aimed to be a licensing conduit for music, has been diseased and for sale for some time.   Despite deals with MySpace and other vendors, they were a casualty of the DRM Wars; never able to grab much marketshare.   Rumors have consistently put them one foot from the dead pool for months.

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One of the rumors floating around the potential merger of Microsoft and Yahoo is that News Corp.  is in discussions to get involved.  The idea, which started floating on blogs like Tech Crunch and Silicon Alley Insider late last night and since escalated to Wall Street Journal reporting, speculates that News Corp is considering rolling MySpace (and possible more of Fox Interactive Media’s assets) into Yahoo.  In exchange, and along with cash paid to Yahoo, News Corp and possible private equity partners would take a substantial stake, as much as 30% of the combined property.

Anything is possible in the Wild West like fog of the Micro-Hoo scenario. News Corps opportunistic investigation certainly makes sense. Where I’m having a difficult time is forming an opinion as to whether such conversations have any shot at being fruitful.  It’s not that Rupert Murdoch has explicitly said no to buying Yahoo (“We are definitely not going to make a bid for Yahoo”).  Click to Read More

Licensing exclusivity can be a major factor in video game success or failure.  The right title, for instance, can drive customers to a console; just look at what Halo has done for the Microsoft Xbox platform or how Sony’s PS3 struggled early on without an equivalent “Tent Pole” title.   Similarly, exclusive content licensing can help define, or destroy, an individual title.  Where would Guitar Hero be without the rights to use popular songs?  What kind of draw would there be for a sports game without the rights to replicate pro teams and players?

Electronic Arts understands these equations as well as any game publisher.  Good games are important. Good games tied to the right content licenses are essential.   As a result, today the Redwood City game publisher expanded their 3 year old contract with the NFL and the NFL Players Union.  Click to Read More

The HD DVD next generation DVD format went on life support went Warner Brothers pledged their loyalty to rival Blu Ray just before the start of January’s Consumer Electronics Show.  A dramatic price cut in January 14th has done little in the way of resuscitation.   Now, in a signal the format’s days are growing especially short, DVD rental service Netflix is dropping HD DVD too.

While Netflix doesn’t rent a tremendous volume of high definition discs, they’ve stocked both Blu Ray and HD DVD since 2006.  Per their new decision, which was announced today, they will phase out all HD DVD discs from their inventory by the end of the year.  They will also cease adding new HD DVD titles effective immediately.

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The attempted acquisition of Yahoo is the big story but in smaller news Microsoft has fortified their mobile software efforts by acquiring Palo Alto based Danger Inc.

Danger is best known for developing T-Mobile’s Sidekick along with software and services that enhance multimedia and web functionality and cell phones. The company was founded by Andy Rubin who is now heading Google’s competitive Android mobile platform project. 

Microsoft’s Robbie Bach, president of the Entertainment and Devices division, said in a statement that “the addition of Danger serves as a perfect complement to our existing software and services and also strengthens our dedication to improving mobile experiences centered around individuals and what they like.”

As recently as December, Danger was in the process of preparing to go public. Click to Read More

With advice from Goldman Sachs, Lehman Brothers and Moelis & Company, Yahoo has confirmed the rumors and officially rejected Microsoft’s proposal.  Now,  it’s back to Microsoft to counter, or escalate the possible takeover.

 In a letter to Yahoo staff, which is reprinted below, CEO Jerry Yang explained their logic.

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