In the video above Steve Balmer gets egged by a student in Budapest who is protesting Microsoft business corruption. Microsoft is getting some flack for “bullying” governmental contracts in Budapest. It seemed like Microsoft was going to lose a 100+ million dollar networking contract; and thats when Steve Balmer arrived in the country and contractual negotiations stopped with a Hungarian provider. The student in the video above, though immature, clearly brought this issue into the publics eye. Will this news story make US national business headlines?

Steve Balmer is widely recognized as the insane CEO who repeatedly chanted: “Developers, developers, developers, developers.” This mantra would bode well for Yahoo, and a Micro-Hoo base company. I have been doing online marketing and advertising for nearly 10 years, and it seems like Yahoo just doesn’t spend time developing their advertising platform. It appears that they spend time managing it, but not improving or advancing their advertising platform. Shame on you Yahoo, you let Google get the best of you. I’m not sure why, but I have some guesses.For nearly a decade Yahoo inflated their earnings by charging a minimum of 10 cents a click. It wasn’t till recently did Yahoo finally change this policy, but from reports from other online marketing blogs; little seems to have changed. A lot of talk, but no action Yahoo - typical Yahoo.

Yahoo is like a spoiled little boy that loses interest in his toys, only wanting new ones to satisfy his ego. Purchases like Right Media, Blue Lithium, etc… have cost billions, and will take a decade or more to recoup those investments. It would have made more sense for Yahoo to develop their content network, instead of letting just a handful of employees take years to finally bring it out of beta (ooops, is it still in beta?) Why the 10 cents minimum cost for advertisers still on the network? Why not unleash the gates of publishing and allow more publishers into the network? Quality control? I think not. Lack of employee empowerment, I think so.

Yahoo spends more time thinking about what it’s going to do next, then doing anything at all. For over 3 months Microsoft and Yahoo have been going back and forth about a price tag. Yahoo wants more money so senior execs and large shareholders can make as much as possible. Microsoft isn’t stupid, their not going to pay through the teeth and screw themselves over in the process. Yahoo executives are busy spending their time saving their jobs and their asses; not improving their search technology or advertising platform.

Yahoo has fleeced advertisers for years, delivering shitty, overpriced results that generally result in negative ROI’s for their advertisers. Super affiliates/marketers took the Yahoo publishing network for millions of dollars. Just look at the impressive checks these wise-asses post on their blogs. How were they doing it? They were web masters of online arcade websites and blended YPN (Yahoo Publisher Network) advertisements into their website. The YPN control panel allowed publishers to choose what niche their advertisements were. So why not display realestate development or legal advertisements? They were blended so well, that users of these websites had no idea what they were clicking. Sort of the bizzaro world of “banner blindness”

Yahoo needs to stop fucking around and immediately take action to improve business performance and return shareholder value. Getting rid of Terry Semel was the first step. The second step is to focus on your core competencies. If Microsoft is going to aggressively pursue a purchase of Yahoo by buying up shares on the open market, so be it; and it might cost Microsoft even more then $31-$33 a share. Stop buying display advertising networks. There are only so many publishers, and they already work with all the majors. Start-up display advertising networks are being overvalued. Now that Yahoo has the components to compete with Google; start competing with them! Don’t let your platform continue to languish, COPY GOOGLE ADWORDS. Sorry to say it Yahoo, but there is no shame in copying Google Adwords.

Google Adwords is integrating the entire advertising agency in one simple platform. After just a week of using Google Adwords nearly anyone can figure out how to use it. Empower your users Yahoo! Why cause first time advertisers frustration by requiring them to have certain spend limits before upgrading their upload capabilities? I quote Steve Balmer again Yahoo, “Developers, developers, developers, developers!”

As predicted here on this blog - Yahoo is getting bought by Microsoft (booyah kasha!) Keep in mind that the man structuring this deal appears in the video above. In interviews I’ve read online with Steve Balmer I think it’s clear he doesn’t understand the online market and how to profit from it. Microsoft’s facebook purchase clearly demonstrates their lack of understanding. Google just announced yesterday that paying for ad inventory on social networks was hurting their bottom line - and users on Facebook are even more fickle about clicking ads than they are on MySpace.The Yahoo acquisition for Microsoft will ensure a solid future for both companies during the next 10 years. The synergies to both companies should certainly help create more shareholder value than if the companies stayed apart, did some type of merger, or commercial venture together. Yahoo is the only remaining competitor to Google and this purchase verifies that. So what can we expect from a MicrosoftYahoo! in the second half of 2008 when the deal closes:

• One of the largest display advertising companies in the world
• Launching of mobile software to compete with Google’s Android
• Microsoft Search (Windows Live or MSN) and Yahoo Search merging.
• Windows Vista updates featuring Yahoo search
• More consolidation in internet video (the next logical step is to compete with YouTube)
• Enhancements for publishers looking to make money from contextual advertising
• Google continues to eat away at MicrosoftYahoo! unless MicrosoftYahoo! begins to reshape iself and act more like Google.

Please leave your comments and let Banner Blindness readers know what you think a MicrosoftYahoo! will bring in the second half of 2008.