Culture: The Biggest Single Impediment to the Microsoft-Yahoo Deal

Culture: The Biggest Single Impediment to the Microsoft-Yahoo Deal
By William J. Holstein
February 1st, 2008

Okay, let’s assume that Microsoft is successful in grabbing Yahoo and that anti-trust authorities in Washington don’t block the deal entirely.

There’s still a major question mark hanging over the deal–the role of culture. Microsoft’s culture is somewhat inbred, arrogant and totally focused on Windows. Microsoft people have consistently shown that they don’t know how to play any game on the basis of anyone else’s rules. They either play on the basis of their rules (i.e. some version of Windows) or they don’t want to play.

Yahoo has a totally different culture, partly because it is located in Silicon Valley, but also because it’s a much younger company and it is one more given to cooperation across technology platforms. It displays much less technological hubris than the evil empire of the North, i.e. Microsoft.

I think there will be huge problems in integrating these two cultures, which is ultimately the goal even if Microsoft right now says it wants to respect some of Yahoo’s independence. I don’t think it’s irrational to wonder whether if Microsoft every truly absorbs Yahoo, it will kill the patient.