News Analysis: A Step Back for Microsoft and What Next

Steven A. Ballmer, Microsoft’s chief executive, walked away from a Yahoo deal on Saturday still looking for an answer to his company’s fundamental problem: its time-tested recipe for success isn’t working against Google, the leader in the current wave of Internet computing.With a bid for Yahoo, Microsoft was trying to buy its way out of the problem. It was a controversial step and a gamble, but at least it was a big move. Now, there is no clear prospect of a quick fix for Microsoft, as the center of gravity in computing continues to move away from the personal computer, Microsoft’s stronghold, and to the Internet. Deal Dies, Yahoo Weighs Its Next Move
How low will Yahoo’s stock go on Monday? And how long will it stay there?These questions are high in the minds of Yahoo shareholders, and probably its management, as the company considers its options after Microsoft’s decision to withdraw its offer to buy Yahoo for $33 a share, or approximately $47.5 billion. rises on Yahoo to placate investors
Microsoft’s decision to abandon its blockbuster bid for Yahoo is expected to cause a sharp drop in Yahoo’s stock price Monday morning, raising pressure on the company’s chief executive, Jerry Yang, to placate investors with a new strategy.Analysts say Yahoo’s shares could tumble as much as 30 percent after the company over the weekend rejected a sweetened, $47.5 billion offer from Microsoft. After Yahoo continued to hold out, Microsoft said it would walk away rather than pursue a hostile bid.

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