Sunday, May 4, 2008
Making a profit
Yesterday's decision by Microsoft Corp. to withdraw its $42 billion-dollar offer for Yahoo Inc. may not be what shareholders in both companies wanted, but it's probably the best thing for everybody else. Yahoo's board wanted $37 a share for the company, one of the world's largest Internet firms, but Microsoft, the world's largest software firm, refused to offer more than $33 a share. Microsoft initially bid $31 a share for Yahoo three months ago. Competition in the high-tech world has been great for consumers but this deal would have concentrated much more power in the hands of Microsoft, which already dominates the software industry. Besides, U.S. companies have made their money buying and selling each other, rather than building and improving actual products, for far too long. Shuffling money back and forth doesn't put better products on the shelves, doesn't build better cars and doesn't put more people to work -- in fact, the motivation behind these kinds of combinations is to employ fewer people.