• Business Week, Thursday, May 11, 2006 11 AM

Steve Rosenbush has written a piece that explores the various ways that Microsoft can more successfully play in the world of content.  First, he chronicles Microsoft's recent moves, which mostly involve the acquisition of other companies.  (Sound familiar?)  He also recalls that the giant Redmond, Wash.-based corporation has gone down this path before, with decidedly unsatisfactory results.  (Remember Sidewalk.com?  Didn't think so.)  At heart, Microsoft remains a software developer, which is where its strengths lie. But in order to thrive in the current Internet/media environment--and to survive the onslaught of Google--Microsoft may need to produce entertainment and educational programming (again), and that's a mighty challenge for the geeks in Redmond.  Even Gates and Ballmer think so.  According to Business Week's Rosenbush, Microsoft can pursue any of several strategies in order to kick-start its content-producing ambitions.  One even includes the purchase of content giant Time Warner.  The two companies have a mostly cordial relationship these days, and there's potential upside in a greater alliance.  "It would be a great move," says analyst Susan Kalla of Caris & Co. In such a deal, Microsoft would be able to take advantage of Time Warner's current low multiple, without hurting its own valuation or stock price, she tells Business Week. But an outright purchase, which would be in the $73 billion range, is considered highly unlikely, Rosenbush acknowledges.

Read the whole story at Business Week »