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Current DateTime: 05:33:53 11 Feb 2012
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Microsoft CEO Ballmer: His Memo On Plans For Yahoo

Published: Friday, 1 Feb 2008 | 11:02 AM ET
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By: Jim Goldman
Silicon Valley Bureau Chief

AP

I've gotten ahold of Microsoft [MSFT  Loading...      ()   ]CEO Steve Ballmer's internal memo he emailed to the troops this morning about his plans to spend $45 billion in a hostile bid for struggling search stalwart Yahoo [YHOO  Loading...      ()   ] . (Thanks for sending. You know who you are!)

He begins by writing:

"Today, I am very excited to announce that Microsoft has made a proposal to acquire Yahoo!. This announcement represents a big opportunity for Microsoft, and is the next major milestoneHe begins by writing: in our companywide transformation to embrace online services, search, and advertising."

He echoed that milestone language in his conference call with analysts and media this morning, suggesting it's the dawn of a new era for Microsoft, focused on the massive opportunities afforded by online advertising.

He says:

"By combining the strengths of our companies, we can deliver an efficient and highly competitive offering for our customers. Our complementary assets will give us increased talent and scale to compete in the markets of search and online advertising, and pioneer new innovations in the areas of video, mobile services, online commerce, and social media."

That's a load of buzzwords that haven't necessarily been associated with Microsoft these last couple of years. Sure, buzz picked up around the company's move for a tiny piece of Facebook last year, but this deal, and the way Microsoft is pursuing it, is a far different animal. And it builds significantly on the progress the company's CFO Chris Liddell mapped out to me following earnings last week that Microsoft is enjoying in its online business. Still unprofitable, but topline is growing big-time.

Ballmer's note to employees this morning says:

"We are on a good path with our existing search and advertising product roadmaps. To date, we have made progress in our organic online services and advertising efforts, and by joining with Yahoo!, we will take the next step toward becoming a major search destination and social platform for consumers. The combined reach of our content properties and combined breadth of our tools for advertisers will enable us to provide an online advertising platform at scale. Together, we'll create a company that is in a much better position to compete against an increasingly dominant player in this market."

Integration issues have also come up. Ballmer says Microsoft's recent acquisitions of aQuantive and Tellme taught it how to deal with combining another workforce and culture into its own. But Ballmer goes a big step further; his optimism about getting a deal done showing through:

"Leaders from both Microsoft and Yahoo! will work together closely on the integration process to ensure that we are thoughtful about the questions we ask and the decisions we make. As we move forward, we'll look carefully at how to bring our assets together to create the greatest value for customers, employees, and shareholders."

Umm, note to Ballmer: You can't "work together closely" when a deal hasn't even been closed yet. There's been reluctance at Yahoo for this combination for the better part of 18 months. Welcome to the Steve Ballmer steamroller. Never mind that reluctance, Ballmer is moving ahead. Period.

He closes with:

"A great opportunity is in front of us to evolve how people and businesses create, find, and use information. Through today's proposed acquisition, we can take our business to new levels of success and growth."

That's a message as much for Microsoft employees as it is to Yahoo's board.

--CNBC.com has business relationships with both Yahoo and Microsoft.

Questions?  Comments? 

© 2012 CNBC, Inc. All Rights Reserved


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