Around the Net
Microsoft And IAC Asking For It?
- Reuters, Thursday, October 29, 2009 12:50 PM
"Microsoft Corp is viewed as the most likely buyer or partner ... if CEO Barry Diller decides to throw in the towel," the news source writes.
That assumption, meanwhile, rests on a specific interpretation of comments Diller gave earlier this week on a conference call with Wall Street analysts. "Diller effectively hung a 'for sale' sign on Ask.com," Reuters writes, by calling the search business "challenging," and its future "speculative." Then, answering questions about whether he would consolidate Ask, Diller said, "The answer is 'Yes.' And it is unlikely that we would be the consolidator."
Granted, Ask's share of the search marketplace seems to have stalled indefinitely at about 4% despite millions and millions of dollars in TV advertising, vertical marketing partnerships with the likes of NASCAR, and various technological innovations.
Microsoft, meanwhile, is indeed seeking distribution deals with any number of partners to compete against Google. And, according to Reuters, the software giant "is viewed as willing to spend to bulk up its search share."
"Right now, Microsoft wants share so they could pick up those points from Ask," Colin Gillis, an analyst at Brigantine Advisors, tells Reuters. "Plus it has a double impact since Google powers Ask's paid search."
Later in the story, Reuters does concede that the soon-to-be-independent AOL does present an interesting partnership opportunity for Diller's IAC. Indeed, IAC "could be open to a partnership (with AOL?) at some point in the future if it was beneficial to all parties involved," Credit Suisse analyst John Blackledge wrote this week in a client note.
Why not just buy a stake in AOL? "Such speculation has dogged IAC because it has around $1.8 billion of cash and barely any debt," Reuters writes, "but Diller has maintained he is only interested in small acquisitions."
