Imagine a poker game where only billionaires can play. The pot they are playing for is worth billions, of course, and each player would risk all their winnings for fear of losing this grand pot...and for fear that missing this one pot could eventually mean losing the entire game.
That's not a bad analogy for the deal where Microsoft buys Skype. Others were sitting at the table, but Microsoft bluffed its way through and put in $8.5 billion to take the hand.
Microsoft's known to only grudging buy up companies, compared to, say, a Cisco that has acquisition in its culture. When Microsoft does buy, the company is so tough and so arrogant on terms that those deals can blow up. Remember the Yahoo fiasco.
Then there was the $6 billion acquisition of advertising firm aQuantive in 2007 where Redmond failed to find a role for the Razorfish division before anxiously selling it off. Microsoft still struggles to make a profit from online advertising.
And Danger, which lived up to its name, as far as Microsoft was concerned. Purchased for an estimated $500 million in 2008, Danger was the mobile tech company that produced Hiptop. Instead of a HTC-like success in mobile telephony, Microsoft turned it into the stillborn KIN phone...and now, not even relatives are looking for the Next-of-Kin.
So while the MicroSkype deal is signed...it still has to be consummated. Meanwhile, this deal is the biggest-ever Microsoft deal and exactly what did the conservative Microsoft buy?...
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