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Microsoft E-Mails Employees Regarding Yahoo Acquisition

On Friday Microsoft released an e-mail sent from Kevin Johnson, president of the Microsoft Platforms & Services Division, to employees of his department commenting on how consolidating with Yahoo might impact them and Microsoft as a whole.

The e-mail reads, in part:

"If and when Yahoo! agrees to proceed with the proposed transaction, we will go through the process to receive regulatory approval, and expect that this transaction will close in the 2nd half of calendar year 2008. Until this proposal is accepted and receives regulatory approval, we must continue to operate our business as we do today and compete in this rapidly changing online services and advertising marketplace.

It is important to note that once Yahoo! and Microsoft agree on a transaction, we can begin the integration planning process in parallel with the regulatory review. We can create the integration plan but we cannot begin to implement it until we have formal regulatory approval and have closed the transaction. Because the integration process will be critical to our success as a combined company, we are taking this very seriously...

Our proposal includes a thoughtful integration planning process for a Microsoft-Yahoo! combination. It is important to me that this process includes leaders from Yahoo! and Microsoft and is done in a way that enables us, together, to make decisions in a collaborative way. Importantly, this will be an inclusive process with Yahoo! employees as they are a key part of our success as a combined company."

In the e-mail, Johnson also addresses questions he said he received from employees, including whether the merger would mean a reduction in staffing:

"While some overlap is expected in any combination of this size, we should remember that Microsoft is a growth company that has hired over 20,000 people since 2005, and we would look to place talented employees throughout the company as a whole. We have no shortage of business and technical opportunities, and we need great people to focus on them."

He also comments on what a combined Microsoft/Yahoo might mean for the Windows Live, MSN and Yahoo brands:

"The Yahoo! brand is one of the reasons the combination of the two companies would create so much value. It is premature to say which aspects of the brands and technologies we would use in our combined offerings...How we integrate Microsoft and Yahoo!’s brands, products, and services are the types of decisions that would be made during this integration planning process -- by leaders from both companies -- and implemented over time after the transaction closes."

Johnson also attempts to address concerns on how Microsoft would handle Yahoo's non-Windows infrastructure:

"Services we've acquired over the years have been based on both Windows and open source technologies. Although Windows is our strategic platform and in some cases the teams ultimately migrated their products to Windows for a variety of reasons, in other cases we have prioritized continuity and have used open interoperability mechanisms to achieve effective systems integration. Yahoo! has made significant investments in both its skills and technologies, so we would work closely with Yahoo! engineers to make pragmatic platform and integration methodology decisions as appropriate, prioritizing above all how those decisions would impact customers."

The full text of the e-mail can be found here.

About the Author

Becky Nagel is the executive editor of the 1105 Redmond Media Group's Web sites, including Redmondmag.com, RCPmag.com, RedDevNews.com and VisualStudioMagazine.com, among others.

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