Liddell destroying Microsoft from within
That's the trick paper executive Chris Liddell, now Microsoft's CFO, claims he can pull off. To do what no one has ever been able to do before, to literally bet the company on a strategy which has been proven not to work.
Ironically the $45 billion bet on Yahoo, partly funded by debt, comes just as Microsoft is finally starting to make good on its decade-old promise of earning money beyond Office and Windows.
Even if the Yahoo chance goes begging (which it won't), the Liddell-ization of Microsoft is proceeding apace. The Guardian notes enthusiastically the company has made nearly 50 acquisitions since Liddell signed on.
And there's nothing the capitalist tools love more than the story of a swashbuckling CFO making his investment bankers wealthy beyond their wildest schemes.
The only problem is, it almost never works.
There are tech acquisitions that can be made to work, where you're not taking on too much risk, where you're buying a business you understand, when you're buying something small which is set to grow.
Sometimes, if you have a really remarkable operations guy in charge, you can make a bad deal look good. After it's gone bad.
But Yahoo's own history is proof positive that paying out billions and slapping your name on someone else's product or service is no guarantee of a return.
There is good reason for this. Technology is all about executing on ideas. That takes vision and autonomy. Take out the company and you take out the autonomy, often the vision as well.
The vision exits with a big bag of cash and a new dream. You're stuck with the operations and the drones who stayed behind.
In the end (returning to this blog's ostensible subject) this is a very good deal for open source. It takes Microsoft's eye off the competitive ball. It tells everyone inside Big Green to forget about intrapreneurship. It eats up the cash Microsoft had to threaten Linux with.
But this is going to end as all tragedies must, with tears. Steve Ballmer is getting taken for the biggest ride of his life, and one day he's going to find himself dumped out of the limo by the side of the road wondering what happened.
When that happens, let him know that I just told him. That and $5 will get him a cup of coffee at Starbucks. But he'll have to pay for the WiFi.