Steve Ballmer Agreed To Sell MSN To Yahoo; Marissa Mayer Killed The Deal

12

You may remember almost two years ago then president of PayPal, Scott Thompson, agreed to become CEO of Yahoo.  It turns out he had some factual inaccuracies on his resume, including not actually having obtained a degree in computer science.  This controversy led to him resigning and Ross Levinsohn was named interim CEO.  Levinson truly believed he would be named permanent CEO, and as it turns out he would have been if not for Marissa Mayer.

However, in the time Levinson was CEO of Yahoo, he put together a radical plan for the company and started to implement it at full speed.  BI reports:

Levinsohn walked into the room; all of his top executives followed.

There was Jim Heckman, Levinsohn’s top dealmaker, who’d spent months negotiating a huge deal with Microsoft

Levinsohn told the board that, under his direction, Heckman had begun negotiating a deal with Microsoft to exchange Yahoo’s search business for Microsoft’s portal, MSN.com, and large payments in cash. Levinsohn and Heckman had also been talking with Google executive Henrique De Castro about turning over some of Yahoo’s advertising inventory. There was also talk of unloading some of Yahoo’s enterprise-facing advertising-technology businesses into a joint venture involving New York-based ad tech startup AppNexus.

He told Mayer that he’d negotiated a deal with Microsoft CEO Steve Ballmer, wherein Yahoo would turn over its entire search business — patents and all — in exchange for Microsoft’s large online media property, MSN.com, and long-term, guaranteed cash payments.

Heckman said his plan would allow Yahoo to run with just 4,000 full-time employees, far fewer than the 15,000 full-timers and thousands more contractors Yahoo employed then. He said Yahoo EBITDA (Earnings Before Interest, Taxes, Depreciation and Amortization) would increase by 50 percent if Mayer closed his deals.

Mayer heard him out, taking notes the whole time.

Within 24 hours, Mayer let Heckman know that she’d canceled all his deals and that his services were no longer needed by Yahoo.

Heckman flew to Ibiza, Spain for a 30-day vacation.

BI has a comprehensive overview of Marrisa Mayer’s career, highly recommended reading: The Truth About Marissa Mayer: An Unauthorized Biography

Om Malik also tears Yahoo apart, the reason Yahoo’s stock  is doing well has more to do with Alibaba than most people think: No Henry, you need to get real about Yahoo. Here are the facts/

Marissa Mayer Japanese Marissa Mayer Red Dress

About Author

Suril is a scientist, journalist and obsessive Microsoft observer. He holds an advanced degree in Biotechnology with minors in Biochemistry, Microbiology, and Molecular Biology. Send him tips on twitter: http://www.twitter.com/surilamin

  • http://www.twitter.com/clydedied Conunmdrum

    Is the cover picture of Marissa Mayer really necessary?
    (Oh and you spelt “Marissa” incorrectly in the first paragraph)

  • NegLewis

    Yahoo buys BB.

    • grs_dev

      I see more Google or Amazon buying Yahoo.

      Google sent Marissa to Yahoo for a reason. It wasn’t because she ran out of things to do at Google.

  • counterblow

    I can’t wait to see that bitch fall. This would have been a sweet deal for Yahoo…..instead they buy Tumblr from a teenager…

    She is an idiot, and trying to run the company like a man will be her downfall.
    It is like Carly Fiorina all over again….and this ice queen ain’t no Carly…she has delusions of grandeur.

    • grs_dev

      ummm actually it’s not. MSN has 0 footprint on mobile. Tumblr at least does have some traction there.

      • counterblow

        hey check this out….MSN is a -website- that can be accessed from…wait for it, a mobile web browser! And tumblr is a website that can ALSO be accessed from a mobile web browser.
        MIND. BLOWN!

        • grs_dev

          What determines whether a web property is a mobile one or not is usage not accessibility.

          When you compare the amount of traffic each of these 2 properties is getting from mobile devices it’s clear msn.com is no where near as significant of a mobile player as tumblr is.

          I could have been all negative and condescending in my response but i chose to be positive and constructive. Mind blowing!

  • leharmeerak

    MSN, is one of the few services from Microsoft that I don’t use…

  • BeefNeeg

    I would bang her so hard we both would puke upon our simultaneous climax.

  • Yuan Taizong

    Good thing, M.S.N. is great and it’s handy, Microsoft can easily capitalize on M.S.N. via advertertizing their products onto it, and M.S.N. has a lot of potential that Microsoft isn’t presently using, Yahoo! doesn’t win over M.S.N. in a lot of countries, Heckman was on to something, it’s a good thing he didn’t win, otherwise M.S.N. would’ve sucked, Microsoft does a great job with it, especially the new M.S.N. for Touch, but Yahoo! would’ve wrecked it, their internal culture is already too far down, they’re bound to become the next America On-Line (A.O.L.).