Tuesday, April 7, 2009

Sun and IBM, Yahoo and Microsoft: Learning From Mistakes?

Like Yahoo, like Sun. Yahoo rejects a tremendous buyout from Microsoft last summer, and the stock tumbles. Total drop in market cap: $30 billion. This week, Sun rejects a tremendous buyout from IBM and the stock tumbles. Total drop in market cap: $2 billion and counting. Aside from the mysterious fact that both companies, and both boards, have walked away from a huge premium, what else is going on here?

The answer is a nutshell is “attachments.” Attachments to people, places, and things are among the most powerful emotional drivers of action, sometimes leading reasonable people to make huge mistakes. Think Bernie Madoff and his unfortunately legion of followers who needed to know “the right people” to be given a chance to invest with the man that churned out 10-12% returns in good seasons and bad. No one (or hardly anyone among his investors) asked any questions – crazy Bernie was one of us, a man to be trusted.

Well, the attachments at Yahoo, and now Sun, are not of the same pedigree, but certainly of the same ilk. At Yahoo, founder and then CEO Jerry Yang built the company into a Silicon Valley legend, thumbing his nose at Microsoft’s hegemony in the process. To then turn around and sell your baby to “the evil empire” was just too much, regardless of price. Keep demanding more, and even a deep-pocketed Microsoft will take its chips and go home.

Enter Sun. Built by Scott McNealy, Sun was an original that prided itself on its independence. Relegated to the board while Jonathan Schwartz took the reins as CEO, Scott could do little harm, until now. Leading the boardroom revolt, McNealy and his faction of directors upped the ante on IBM (and CEO Schwartz in the process), driving the big bidder (close to $10 a share, a 100% premium when offered) away. Founder McNealy, like founder Yang, too attached to the companies they built to imagine selling to the industry winners. And shareholders lose, again.

19 comments:

  1. hopefully future SUN, IBM, Yahoo and Microsoft can do better and was sorry for his actions and not repeat it.
    ---------------------------------
    wisata riau

    blogger tutorial

    Pesta Blogger

    Kuansing

    Pekanbaru Riau

    Hibah Sejuta Buku

    ReplyDelete
  2. i like this content..
    The answer is a nutshell is “attachments.” Attachments to people, places, and things are among the most powerful emotional drivers of action, sometimes leading reasonable people to make huge mistakes. Think Bernie Madoff and his unfortunately legion of followers who needed to know “the right people” to be given a chance to invest with the man that churned out 10-12% returns in good seasons and bad. No one (or hardly anyone among his investors) asked any questions – crazy Bernie was one of us, a man to be trusted.
    -------------------------
    Belajar SEO|Hibah Sejuta Buku|Riau Bisnis Online|Pekanbaru Riau

    ReplyDelete
  3. Pekanbaru Riau
    i like this content..
    The answer is a nutshell is “attachments.” Attachments to people, places, and things are among the most powerful emotional drivers of action, sometimes leading reasonable people to make huge mistakes. Think Bernie Madoff and his unfortunately legion of followers who needed to know “the right people” to be given a chance to invest with the man that churned out 10-12% returns in good seasons and bad. No one (or hardly anyone among his investors) asked any questions – crazy Bernie was one of us, a man to be trusted.

    ReplyDelete
  4. Great post! I’m searching for this information for long time and I have found it here. Kontes Seo Kerja keras adalah energi kita Pertamina | Tutorial seo

    ReplyDelete
  5. Hi this is my first time visit to your blog, thanks for sharing the valuable information oh yeah if you have an interest in Tourism and vacation destination so you can get the idea about the great place to visit in your holiday. or if you love to see the bizarre and weird news around the world you can go to Crazy World or the World Most Craziest Pictures and also the craziest news in the World Must Be Crazy

    Don't forget to read about the Menstruating Ghost of Puncak you can read it on Kaskuz News OK thanks a lot Revarius Opinion.

    Berita Ekstrim Blog
    Chevy Trucks
    Celeb Toob
    Girls Modele
    Healthy Lifestyle
    Celebrity News and Update
    Dunia Celeb
    Berita Ekstrim
    Lowongan Kerja Terbaru

    Thanks for the information

    Denise Milani in Sexy Red Sweater
    Denise Milani sexy black dress
    Denise Milani in Sexy Teacher Set
    Denise Milani Officer Set
    Best Photo Denise Milani

    Revarius Nite
    Revarius Journal
    Crazy Tube

    ReplyDelete
  6. Yes, I agree with you, they are a big companies and I think they have to learn from theirs mistake.

    ReplyDelete
  7. Very informative and trustworthy blog. Please keep updating with great posts like this one. I

    have booked marked your site and am about to email it to a few friends of mine that I know

    would enjoy reading.


    cabal alz
    cabal alz

    ReplyDelete
  8. You got so many points here, that's why i love reading your blog. Thank you so much!
    mba india

    ReplyDelete
  9. Earn global money shows you different earning programs from all over the globe and help people to earnmoney from different visit=www.earnglobalmoney.info click here

    ReplyDelete
  10. Very informative and trustworthy blog. Please keep updating with great posts like this one. I

    have booked marked your site and am about to email it to a few friends of mine that I know

    would enjoy reading.


    wow gold
    cheap wow gold
    wow gold
    buy wow gold
    wow gold
    cheap wow gold
    buy wow gold

    ReplyDelete
  11. Very informative and trustworthy blog. Please keep updating with great posts like this one. I

    have booked marked your site and am about to email it to a few friends of mine that I know

    would enjoy reading.


    lineage 2 adena
    cheap lineage 2 adena
    lineage 2 adena
    buy lineage 2 adena
    lineage 2 adena
    cheap lineage 2 adena
    buy lineage 2 adena
    lineage 2 adena
    lineage 2 adena

    ReplyDelete
  12. Well, the attachments at Yahoo, and now Sun, are not of the same pedigree, but certainly of the same ilk. At Yahoo, founder and then CEO Jerry Yang built the company into a Silicon Valley legend, thumbing his nose at Microsoft’s hegemony in the process. Nice to know it.

    Link Building Help

    ReplyDelete
  13. I was just thinking about Caribbean Cruise to start operating departing from Cozumel Island. and you've really helped out. Thanks! Newborn Care Tips

    ReplyDelete
  14. I am very appreciate your site,and your article is useful, thank for sharing us this information. Tips To Have a healthy Pregnancy | How to Get Fair and Healthy Baby

    ReplyDelete
  15. This was a really outstanding post. In theory I would like to compose like this too - taking time and real effort to make solid Information.register of massage therapist in Brampton

    ReplyDelete
  16. Mangalmay Institutions offer three years full time regular BBA Programme in Delhi NCR, BBA in Delhi NCR, BBA College Noida, Best BBA Colleges in Greater noida.

    ReplyDelete