The Yahoo Saga: Ballmer, Icahn and Now Schmidt!

A few months back when we wrote our cover story about Microsoft possibly buying Yahoo, we knew it would be a long slog and the deal may never happen. We wrote the story anyway, analyzing what WOULD happen IF Microsoft bought Yahoo.

The on-again, off-again deal is still on-or-off, but one thing we know for sure is that Microsoft is changing the terms. In an offer made this weekend -- which Yahoo rejected -- instead of paying $33 billion for the whole kit and kaboodle (that would be a good name for an Internet company, instead of Googling, you could Kaboodle), Ballmer now wants just the search part -- for $1 billion. You mean to tell me that Yahoo search is only 1/33 of the value of the entire company? Of course, Ballmer promised some future payments and would even loan Yahoo a billion or two at 5 percent interest.

If such a deal were to happen, the rest of Yahoo would go to Carl Icahn, who has messed up a company or two in his time (such as TWA), as he tends to rip out all the parts of value. Lately, though, Icahn has been putting wobbly companies back on solid footing -- a nice change of pace.

Yahoo, for its part, seems confused. There are reports that it wants to go back to the $33 billion offer that is off the table. At the same time, some Yahoo-ians are accusing Microsoft of meddling, trying to create a new Yahoo board (for a company Microsoft doesn't own) and break up Yahoo (which it is also clearly trying to do).

Google CEO Eric Schmidt is solidly in Yahoo's corner. Schmidt, who is cutting an ad deal with Yahoo, said he believes Yahoo should remain independent. I get the feeling Schmidt doesn't want any more competition from Microsoft.

Windows Patch Sets Off ZoneAlarm
ZoneAlarm users who thought they were doing a good thing by patching their Windows DNS servers got a bit of a surprise -- the DNS fix locked ZoneAlarm out of the Internet, making it impossible for the CheckPoint security software to properly do its job.

If you have this problem, head to for a fix.

Meanwhile experts say this problem should not deter you from using the DNS patch, as it helps thwart spoofing attacks.

WSUS Glitch De-Glitched
From our previous item, it's clear just how important it is to patch, regardless of occasional conflicts. But many using Windows Server Update Services (WSUS) recently found that the server update service can't update their servers. Microsoft has already fixed the software that is itself designed to fix software.

My guess is that the rush to fix problems is creating flawed patches and conflicts with other bits of software. What say you? Is the speed or the stability of a patch more important? Send your answers to [email protected].

About the Author

Doug Barney is editor in chief of Redmond magazine and the VP, editorial director of Redmond Media Group.


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