If I was Microsoft and Wanted to Win.
I think that now is the best time for companies with a lot of cash on hand to invest in acquisitions while company valuations are so low. One company I am going to focus on is Microsoft. I am going to pretend that I have $6.3 Billion of their money to buy other companies. ($6.3 Billion because that is what they used to purchase AQuantive.com) Microsoft has $20-$25 Billion in Cash. Listed below is the companies I would buy or invest in, how much I would invest, and why. Some of the companies are privately held and some are public, some are large, some are small. All of my recommendations offer strategic moves for Microsoft to make them more effecient or position them for growth. Microsoft could already have business plans similiar to these businesses, but adding these companies could help them leapfrog other competitors. My choices center around advertising and media, while a few have other agendas. The last item is a division that I want Microsoft to expand in, not buy into.
In no particular order or importance, each acquisition would add its own mark on Microsoft. The price next to the company is what I would pay/offer if I were making the terms, I do not know the valuations of private companies, I can only guess. This is a pretty long list so get ready.
ATTN Microsoft, I would love to work in your strategic acquisitions division. I will take a salary and so many shares of stock every quarter and a nice office and house. Just email me ThomasJowers@Aol.com
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Freewebs.com $1.6 million, This is a company that lets users create Free Websites, the site in turn gets to put advertisements on those websites unless the members choose to upgrade. If I remember right this site uses Google ads. Purchasing this property would give another outlet for MSN AdCenter, and serve a small blow to Google ads. For a small investment this should create a wealth of ad space for Microsoft.
ZoomShare.com $500,000, This company is almost exactly like Freewebs.com but smaller, again more viewers for Adcenter ads and a small hit to Google ads.
Digg.com, $75 Million, Believe it or not, Digg is still a hot web property. Microsoft could intergrate Digg into its own news site and it could also fit into Facebook (Microsoft is a minority owner of Facebook) Just think of all the eyeballs that visit Digg.com everyday, lots of ad space. It also plays on the social news genre! Digg is the best of best when it comes to social news sites.
Twitter.com, $55 Million, An amazing social site that everyone from politicians to students are using. Right now it has a few monetization problems but Microsoft could fix that with ad support on the website, enroll in a profit sharing contract with text message providers, and even intergrate this into the Zune. The Zune now has wifi capabilities at McDonalds around the country, now people can "Tweet" from their Zunes when at McDonalds. How much would McDonalds pay to send a Tweet to every Zune in wifi range letting Zune owners know about special McDonalds Deals. I own a Zune and would love this! Everytime a Zune is sold it could come loaded with the Twitter Application!
Interactive Corp. (IACI) $2.4 Billion, A search engine with built in advertisers and cash flow. It is a hip and cool search engine that has lots of other web properties including: Evite.com, Match.com, CitySearch.com, and Ask.com among others. This could be merged into the Adcenter platform. I would like the websites to still look the same but the advances in search technology would help Microsoft. With interactive Corp, Microsoft would gain more search share, more advertisers, and more web presence. I am also sure that with this company Microsoft could restructure part of the company to account for some cost savings and ineffeciencies within its own platform.
AdBrite.com, $68 Million, Currently Adbrite already has 85,000+ websites in its network serving over 375 Million ad inpressions daily.....daily. What a boost that would be for Microsoft Adcenter. I us Adbrite for a few of my websites and have been very pleased! It is already the 3rd largest ad network on the net, larger than Microsoft!!!!!
NetFlix, $128 Million, 11% stake in the company. I think that this would help Microsoft get its hands on a cash cow. Monthly memberships, plus a blossoming movie streaming service. Would make a great addition to the partnership they already have in XBox Live, and they could also extend the service to the Zune. Another reason to pick the Zune over the ipod, and another reason to pick the xbox over the wii or PS3.
Mint.com $45 Million, A great way for Microsoft to expand it Software as a Service idea and a way to bundle its profitable Microsoft Money software to consumers that are uneasy putting personal financial information on the web. Also a great platform for financial related ads!
TheStreet.com TSCM $115 Million, I personally think one thing that other portals have on MSN is their financial website, I personally use AOL's, but I like Google's and Yahoo!'s Financial pages. If Microsoft owned TheStreet.com it would hve one of the best Financial website out there. It would also have prime web realestate for Finance Ads. This could also help sell Microsoft money software. If Microsoft purchased TheStreet.com it would also get Mainstreet.com, Stockpickr.com, BankingMyWay.com, Geezeo.com, Realmoney.com, and Dividend.com. Let's not forget the talents of Jim Cramer!
Skype.com $1.2 Billion Currently owned by eBay (they overpaid for skype but wont admit to it) This would be a great addition to Microsoft because it could be a great ad on to Microsoft business partners. Plus it is growing at an impressive rate and generates CASH!
ClickSpeed.com $7.5 Million This is a quirky company that handles a lot of marketing for clients and really could help expand Microsoft's Adcenter program.
Achieveinternet.com $3.25 Million This company creates small social networks for midsize companies. Think of the monthly fees Microsoft could make and the non-competitive ads they could serve in these social networks! Sony and BestBuy already use this company, why shouldnt Microsoft own it for a mere 3.5 million?
StatBrain.com $250,000, StatBrain would be to Microsoft like Alexa is to Amazon. This site would be a stand alone site but would also be integrated into Adcenter.
Sirius XM Radio $95 Million, Microsoft would get 210 Million share of the combined satellite company, 10 commercial radio stations that all sirius xm subscribers would get for free. Microsoft would be interested in this partnership because they would control the commercials on those 10 stations. Again, making google jealous. Also, Sirius would be integrated into Xbox Live and the Zune with a 50/50 profit sharing split for Microsoft! FREE MONEY! Plus Microsoft would have access to satellites in orbit!
MetalFloss $4.2 Million, This would be cool factor for Microsoft. With MentalFloss, Microsoft would gain control of a great website, blog, Magazine, and a quirky shirt company. Microsoft could sell ad space on the site and blog, gain access to print ad sales, and have people all over the country wearing their funny t-shirts!
Superior Internet Solutions, Superiorroi.com, $4 Million, This company does online marketing for small and midsize companies, it also helps outsource projects for the same companies. A great little tack on for Microsoft.
MindFireInc.com, $5 Million, A great ad on for Adcenter, helps marketers make sense of and track traffic coming to their site.
LookSmart.com $33 Million, A publically traded search portal. It already has built in advertisers and users. Another way for Microsoft to take a jab at Google. Looksmart gets its search results from ask.com which gets its results from Google. Looksmart has $30 million in cash already. If Microsoft were to buy Looksmart, they would also get their own social bookmarking site, Furl.net, yep, you know what I am thinking, more ad space to sell!
Miva.com $18 Million, Another add on for Adcenter. It already has a pretty extensive list of users and advertisers. Why not fold those into Adcenter and create a wider base of users?
iRobot $300 Million, This would be a great growth area for Microsoft. I think that robotics could have a huge market in a few years, especially when consumers really embrace robots as anything other than toys. The zoomba is awesome! Plus, lots of government contracts. Think of all of the businesses that would buy a robotic janitor that you turn on at night and let run till morning, no 401K, benefits, sick days, etc....
BuyItSellIt.com $200,000 An online store format that would let users create a free online store. As of now, it is totally free, I would like to see Microsoft charge a small commission for sold items. I think this would fit in great with the cashback search program.
Build a Computer. $10 Million, This is the section where I would like to see Microsoft build from within. I want Microsoft to build high end PC and Laptops for affluent consumers and businesses. I mean the starting PC would start at about $2,200 and laptops at about $2,500 or higher. These should be the BEST personal computers on the market, best everything! This would help create Microsoft as a status symbol. Like the Mac is now. Create a Cool name for the division and focus on quality not quantity. Microsoft already sells Microsoft branded mice, keyboards, webscams, headsets, etc.... They would come pre-installed with Microsoft software and OS. Maybe curbing some of the market share Safari has taken lately. This would not be a high growth area for Microsoft but a great niche area that could lead to other Microsoft purchases. These computers would only be available shoppers at Saks or other highend retailers as well as online. As other computer makers are slashing prices and margins, Microsoft could court the top 3% of the market where the profit margins are higher! These computers should be built one at a time and everything should be done in one location! Put a Made in the USA stamp on it and really make it something to tout and be proud off. Like the Surface computers Microsoft is already selling.
Who says that Microsoft needs Yahoo.com to be a factor in Online Advertising. If Microsoft were to get these properties, I think Microsoft would become one of the premier Marketing/Advertising firms in the world! And guess what, the total for all these business is $4,568,500,000, or $1,764,500,000 less than the AQuantive Deal. They could use that money to make sure they are the defacto authority in Mobile Search by paying a nice payment to Verizon and AT&T to be the default mobile search company! My recommendations would make Microsoft and Online Powerhouse, make the Zune way more attractive than the iPod, make the XBox the best media center out there, and maje a new outlet for the extremely profitable software sector. It was also give new advertising outlets for Print ads and Radio ads, as well as beefing up hardware sales and profit margins. Another use for the $1.7 Billion would be to create a trust that pays out every 6 months a special dividend to stock holders that has held the stock for at least a year. That would make the stock price go up and stay up. *To create a great buzz, Microsoft should negotiate all of these deals in private and release them all on the same day. What a bonanza that would be.!!!
Again, my prices do NOT represent the value of a company and again, just my guess!
I have an XBox, Zune, use Vista, have Microsoft Money, Microsoft Office, I have used Cashback search, and a few pc games sold by Microsoft.
Disclaimer, I own stock in Microsoft, TheStreet.com, SiriusXM, and McDonalds
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