Time for Mergers

Last 3-4 weeks have created a lot of turmoil for Yahoo. The search engine, email and other services provider company is in news for last 1 year. Founder CEO coming back, constant decline in the search users base, stiff competition from google, profit shrinking, massive layoff plan and then a bid for buy out from Microsoft.
Well Isn't it strange to see in this economy how companies rise and fall. Gone are those days when it used to take years of hard work for people to establish their company to attract any funding from market. Look at GM, Ford and then look at Google.

The dot com boom changed the way investors look at new companies and their prospect. The short term wealth, millionaires over night, 10 people company bought over in billions of dollars, all this has created an illuision in people's mind. Every one wants to be the one betting on the company, which will be valued billions of dollars on the very first day of listing.

Let's take a look at Yahoo, company has been successful in almost every service they provided. They got amazing response from the market but soon their success was well over run by other companies. Yahoo couldn't compete with the innovation Google brought in the market. I might sound like a Google advocate but I just love their thinking in innovation.
Yahoo tried its hand in almost every single thing Google was doing. But the problem in my eyes is they could never come up with innovative service or come up with an exceptional value addition to existing service.

The market is brutal, though yahoo gained the 10$ in market share, employees are promised best severance package etc. But it is almost certain Yahoo will be bought over soon, it may or may not be Microsoft. Time has come for yahoo to show they are different from other companies or they will be another case study for MBA schools.