November 16th, 2007
Does 10+20+30+40 = Microsoft buying Yahoo?
Much is being made of Microsoft President of Platforms & Services Kevin Johnson’s statement this week that Microsoft is planning to become No. 2 online advertising player within three to five years.
Johnson and the Microsoft online-advertising crew have made this same boast a few times this year. What Johnson did share on November 15 during his remarks at a UBS investor conference was more specifics about how Microsoft plans to get there. Johnson, a sales guy through and through, used the catchy “10, 20, 30, 40″ slogan to describe Microsoft’s goals. As Johnson outlined it, the plan is this:
- 10: Get the Microsoft Web sites to comprise 10 percent of all Internet page views (up from what Johnson says is Microsoft’s current six percent share).
- 20: Increase the percentage of minutes spent on Microsoft Web sites from 17 percent per user to 20 percent.
- 30: Grow Microsoft’s online query share from 10 percent to 30 percent.
- 40: Capture 40 percent of all dollars spent via digital advertising (compared with Microsoft’s current six percent online-ad-spend share claimed by Johnson).
Internet Outsider blogger Henry Blodget is most skeptical of Microsoft’s goal to grow search share to 30 percent. He says the only way Microsoft realistically could do this is by buying Yahoo — an acquisition with which the company has been flitting for a year or more.
Given CEO Steve Ballmer’s recently evasive answers around whether Microsoft has decided to buy Yahoo or not, maybe Blodget is right. I just don’t see Microsoft shelling out so much cash on an acquisition where so many of the busineses in which both Microsoft and Yahoo are engaged would directly overlap. Or maybe Microsoft is thinking about other search-focused aquisition targets like Ask.com?
What do you think: Is Microsoft going to do the deed and buy a major search player? And should Microsoft make such a move?
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