Yang Mulls Partnership Deal
Yahoo Look to Bezo at Amazon and Diller at IAC and Ask.com for New Deal
Yahoo Inc. Chief Executive Jerry Yang Wednesday admitted to mixed feelings about the withdrawal of Microsoft Corp.'s merger bid and reiterated Yahoo continues to consider Microsoft proposals for various partnerships.
Mr. Yang, appearing at The All Things Digital conference here, attributed the failed negotiations to more than the disputed price. While price was "the most public issue," he said "regulatory issues and a number of other things" were also concerns. He stressed that it was Microsoft, not Yahoo, that walked away from the negotiating table.
In his first extensive public discussion of the merger, Mr. Yang said the Sunnyvale, Calif., company has changed for the better as a result of the furor over the bid. "In many ways it has pulled us together as a company," he said. Yahoo continues to talk to Google about a possible partnership, he said, without offering any details.
His remarks came on the second day of a conference that heard technology executives hail their companies' staying power despite economic weakness. Michael S. Dell, chairman and founder of Dell Inc., Howard Stringer, chief executive of Sony Corp., and Amazon. com Inc.Chairman Jeffrey P. Bezos took turns promoting their companies' new directions and technologies.
Mr. Dell said the computer maker is reaping the benefits of a recent reorganization and is growing faster in the U.S. than its rivals. Although displaced in world-wide, PC-unit sales by Hewlett-Packard Co., Mr. Dell insisted the Austin, Texas, PC maker still leads by revenue and its outlook remains strong due to a focus on diversifying its businesses.
But, he admitted, "in the U.S., there's definitely caution. You can't have a country where the overall growth is 3.5%, and say, 'that's fantastic,'" he said.
He said consumer preferences are changing. "If you go back five or 10 years ago, we used to go to forums like this and we would talk about megahertz and gigahertz," Mr. Dell said. "But now in the consumer world ... fashion definitely plays a role that it didn't play [previously]."
Sony's Mr. Stringer showed off a television that uses an ultrathin screen technology that uses organic light-emitting diodes, or OLEDs, to illuminate the screen. Sony will start selling a 27-inch OLED set with a screen the thickness of a credit-card within the next 12 months, he said. Mr. Stringer didn't disclose pricing but suggested it would have limited early appeal.
"It is fairly expensive. The only people who can buy one are in this room," he joked. Sony cur-
rently sells an ll-inch OLED screen for about $2,500. He also said Sony's Blu-ray high-definition video format will "more than hold up" against competition from new online video devices. Blu-ray faces new challengers including Amazon.com, which sells movie downloads, and announced plans here to offer streaming services, and Netflix Inc., which recently announced it would allow customers to watch streaming video on their televisions rather than their PCs.
Amazon.com's Mr. Bezos, also said Amazon has improved supplies of its Kindle electrc book reader. "It is selling and we are very happy about it," he added. He declined to provide sales figures. Mr. Bezos offered no other details of the proposed streaming video download device. Amazon already sells video downloads on its Web site, and is increasingly challenging Apple Inc. in the digital realm.
Mr. Bezos said the company plans to keep working on improving its Kindle reader, though said consumers shouldn't intrepret its recent price cut (to $359 from $399) as an indication that a second version is imminent. "There will be a second version and a third version and a 10th version," he said. But he added: "The second version is not that near."
IAC/InterActiveCorp chairman Barry Diller says he is ready to create some trouble again. He told conference attendees that a planned August spinoff of some ofIAC's largest businesses will allow him to "create trouble" instead of "fix trouble." Mr. Diller, who spent the past few months distracted by a lawsuit with majority shareholder John Malone, chairman of Liberty Media Corp., was short on specifics.
Mr. Diller, former chairman of Paramount Pictures and Fox, also had colorful words for his former colleagues in Hollywood and rivals in the online world. "The [film] community is so inbred that it's no wonder the children have any teeth," he said. He called Google Inc. "irrelevant" to IAC but predicted that its growth wouldn't continue indefinitely, leaving new openings for smaller players like his Ask.com.
He also joked that he had been rooting for Microsoft to acquire Yahoo on the grounds that it would have bumped up Ask.com in search-engine rankings "It would have been good for me," he joked.
Activision Inc. Chairman anc CEO Robert Kotick presided over the first public demonstration of "Guitar Hero World Tour," a new multi-instrumental version of Activision's best-selling music videogame.
By: Jessica Vascellaro, Jason Anders, Marcelo Prince, & Nick Wingfield
Wall Street Journal; June 2008
