Eurotechnology Japan KK
The Two YAHOOs - which should you marry?
GOOGLE and MS marrying the Yahoo-Twins       July 29, 2010


Wedding bells are ringing for the Yahoo-twins! Actually, there isn't one Yahoo in the world - Yahoo are twins - the TWO YAHOOs. My interviewer looked surprised when I explained this on CNBC 2 1/2 years ago (watch the clip here). This wasn't part of general knowledge until recently...

Who are the TWO YAHOOs? One twin is Yahoo Inc. and the other twin is Yahoo KK - linked to Softbank. Like twins, they share some genes and the same family name, but otherwise they are independent companies, and independently managed.

Microsoft and Google have been courting both YAHOO-Twins for years:
Microsoft courted the Yahoo-Inc twin - while Google courted the (arguably larger and strategically more important) Yahoo KK twin.

Which of the TWO YAHOO twins is more valuable?
Yahoo KK is about twice as big as (Yahoo Inc minus Yahoo KK)
yahoo inc vs yahoo kk

Turns out that Yahoo KK has a market cap about twice as big as the other twin Yahoo Inc, when we substract the financial holding of Yahoo Inc in Yahoo KK.

Microsoft decided to "marry" the (Yahoo Inc - Yahoo KK) twin, while GOOGLE chose the other - Japanese YAHOO-Twin. IF approved by Japan's anti-monopoly authorities - almost 100% of Japan's internet and mobile searches will be processed by GOOGLE's cloud services and data centers.

What are the implications?

1. It's about who "controls" information flows on the world's most advanced internet and mobile infrastructure - Japan.

2. YAHOO KK's challenge will be not to become a "skin" on Google's services by developing more of it's own technologies.

3. A stronger YAHOO-KK & GOOGLE combination in Japan will also bring Japan's internet forward, globalize Japan more, and make life even more difficult for Japan's traditional brick & mortar media - including giant Dentsu.

4. and finally: Masayoshi Son and Softbank are moving even closer to center stage.
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