All Things Digital

This year’s D conference had its share of great lines–tired ones, too (we’re all clear on the subject of Facebook and information sharing, right?). Here’s a selection of the former…

Guys like us avoid monopolies. We like to compete.”

–Microsoft (MSFT) Chairman Bill Gates

AOL is the Rodney Dangerfield of the Web. We don’t get no respect.”

–Jeff Bewkes, president and CEO, Time Warner (TWX)

I will probably never be a CEO again.”

–Yahoo (YHOO) CEO Jerry Yang states the obvious

It’s a company that creates technology.”

–Facebook CEO Mark Zuckerberg answers the question, “What is a technology company?”

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A tough act to follow, last year’s D: All Things Digital 5. How do you best, or even match, a 75-minute joint interview with Microsoft (MSFT) Chairman Bill Gates and Apple (AAPL) CEO Steve Jobs–a history-making history lesson taught by two principal protagonists of tech’s narrative? Summon Thomas Edison, Nikola Tesla and George Westinghouse from the dead to reminisce about the “War of Currents”?

No. Better to let history make itself, as it always has, and focus on making news. And it’s likely there will be quite a bit of it coming out of D: All Things Digital 6. With this year’s lineup, how could there not? Microsoft’s Bill Gates and CEO Steve Ballmer onstage together just a month before Gates steps back from his day-to-day duties as company chairman. Time Warner (TWX) CEO Jeff Bewkes talking strategy as the media giant prepares to spin off Time Warner Cable and tries to figure out just what the hell to do with AOL. Lowell McAdam of Verizon Wireless (VZ) and FCC Chaiman Kevin Martin appearing separately, but together offering an insider view of the telecom industry as it grapples with issues of Net neutrality, open access and early termination fees. And then there’s Yahoo’s (YHOO) Jerry Yang and Sue Decker, who’ve been struggling to right a foundering Internet pioneer as it battles Google (GOOG), Microsoft, investor-agitator Carl Icahn and itself.

And that’s just a sampling. Clearly, there’s much to talk about. Much news to be made.

Sure, we may not have managed to arrange another tete-a-tete as historic as last year’s Gates/Jobs interview.

But we did manage to get Microsoft CEO Steve Ballmer and Yahoo Co-Founder Jerry Yang on the same stage–albeit at different times. Still, no easy feat, that.

And who knows, perhaps we’ll get them onstage together as well.

So join us at d6.allthingsd.com tomorrow for as-it-happens, all-access coverage of the conference. Liveblogs of the sessions and demos. Videos of the speakers. Photos of attendees. You’ll find it all here.

(Photo illustration by Beth Callaghan)

Microsoft’s unsolicited acquisition bid for Yahoo is apparently looking more attractive to the now-minor Internet major, especially since Carl Icahn has mounted a full-fledged fight for the nine seats now on Yahoo’s board.

Sources close to Yahoo (YHOO) say the company would likely agree to an acquisition if the price is right. Trouble is, Microsoft (MSFT) doesn’t seem to be interested in one anymore.

Or at least that’s the way it would like to be perceived. Speaking at an event in Moscow, Microsoft CEO Steve Ballmer once again feigned disinterest in an outright acquisition. “Yahoo was never the strategy we were pursuing, it was a way to accelerate our online advertising business,” he said. “We will spend money on some acquisitions. You can do a whole lot of things with $50 billion.”

You sure can. Like spend $47.5 billion of it on Yahoo, just as you planned to last month–even though, as BoomTown’s Kara Swisher reports, Chairman Bill Gates harbored little enthusiasm for buying Yahoo.

But that may happen yet. Some inside Microsoft say the software company would still like to acquire Yahoo, it just doesn’t want to pay the $37-a-share or so Yahoo CEO Jerry Yang and Co. are reportedly demanding. And it may not have to, if Icahn and other ornery Yahoo investors like Legg Mason Capital Management (LM) force Yahoo’s hand.

Good thing so rarely a correlation exists between a company’s public announcements and its corporate actions. Otherwise, it might be tough to parse Microsoft’s recent comments about future acquisitions in light of some rumors floating around Silicon Valley today.

While touring Japan this week, company Chairman Bill Gates told a news conference that Microsoft (MSFT) isn’t likely to pursue other deals following its withdrawal of its ill-starred takeover bid for Yahoo (YHOO). Said Gates, “Now at this point Microsoft is focused on its independent strategy.”

Windows Live General Manager Brian Hall echoed that sentiment at an analyst meeting yesterday: “We’ve withdrawn the offer and moved on, and now are focused on how we grow as fast as possible organically.”

Seems this whole Yahoo debacle has put Microsoft off acquisitions entirely. Or has it? As first reported by BoomTown’s Kara Swisher, Microsoft recently contacted Facebook to gauge the Internet company’s willingness to sell it the 98.4% of the company that it doesn’t yet own. No word on what Facebook’s reply was, although CEO Mark Zuckerberg has long said he’s not interested in selling the company. And even if he were, Facebook doesn’t exactly solve the problems that Yahoo would have. It’s hardly a viable source of online advertising …

So after months of negotiations and posturing, Microsoft (MSFT) has given up its efforts to buy Yahoo. And according to Yahoo CEO Jerry Yang, that’s good news.

Indeed, people close to Yahoo (YHOO) said that Yang and Co. greeted the withdrawal of Microsoft’s bid as a victory, with a celebratory exchange of high-fives. In a hopeful statement posted to the Yahoo blog in the wake of Microsoft CEO Steve Ballmer’s stink-bomb of a kiss-off letter, Yang looked toward the future with a beatific, albeit vacuous, grin stretched ear-to-ear.

… Has this experience changed us? Of course, it has. We’ve emerged a stronger, more focused company with an even greater sense of purpose. I’m so proud of how this company has come together, put the noise aside, and showed the world that we have the resolve and determination to thrive in challenging times.

… So, what’s next? With Microsoft’s withdrawal, we’ll be better able to focus our energy on growing our industry leadership and maximizing value for stockholders. We’ll continue to execute on our plan — making your Internet experience as personal, relevant, open and social as possible, serving advertisers so well they insist on working with us, and opening up Yahoo! in a way that developers dream of. And, we’ll also continue to pursue strategic opportunities that position us for long-term success.”

Yeah, good luck with that come tomorrow, Jerry. My guess is by market close, you’ll be “focusing your energy” on damage control for YHOO’s new 52-week low. Perhaps it’s time for another 100-day review of the company, seeing how ineffective that last one was. At this point, it seems the only so-called “sacred cow” you’re going to slaughter is your company’s share price …

Now that Microsoft (MSFT) has abandoned its bid for Yahoo (YHOO), the tech media is sifting the entrails of the companies’ ill-starred merger talks for portents of things to come.

Paul Kedrosky at Infectious Greed says Yahoo has bought itself some more time–and litigation:

I think what has largely happened here is we have bought time and lawsuits. If I was a Yahoo shareholder I’d be seriously pissed. Microsoft pulled us out of our recent share price slump, but management was too cutesy and territorial to take the money and run. My guess is that Yahoo’s share price falls quickly on Monday, and then finds support in the low-$20, a price reflecting a belief that this is not yet over. Only then, once some key shareholders pipe up and once Yahoo has to defend itself against the inevitable lawsuits, will we know how likely it is that its brazen move sticks.”

Mini-Microsoft says Microsoft’s decision to walk restores his faith in the company:

Out of this had best come a new reorganization of our online properties. Out with the old already. We had reached a bet-the-company point in going after Yahoo to make up for the lack of performance out of MSN/Search/AdCenter in an attempt to leapfrog forward. I think we need to hang up on the good-enough consensus culture for a while and put in a strategy czar to get things done vs. expecting something to arise out of the dysfunctional ecosystem we currently have.”

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Microsoft (MSFT) and Yahoo (YHOO) have apparently taken some of their merger negotiations out of the press and into the boardroom. The two companies are said to be in “last-ditch” negotiations to reach a friendly deal, despite threats from the software giant this week that it would launch a hostile proxy bid or walk away from the deal entirely.

DealBook, citing a person involved in the talks, says Microsoft has upped its offer by several dollars a share and refers to the fresh talks as an “enormous breakthrough.” That said, the person also cautions that talks could still be postponed or collapse entirely.

Oh, one last thing: a deal is still not imminent. My God, what a fascinating new development.

Anyway, it seems Microsoft’s sweetened offer isn’t yet sweet enough for Yahoo, which worries that the merged companies would be forced to divest their email and instant-messaging assets by antitrust regulators. “We need a lot of reason to do the deal, because it could be very bumpy once we agree,” a Yahoo insider told BoomTown. “How damaged would Yahoo be if it did not go through or if important pieces of Yahoo had to be separated from the company?”

Well, veteran Google employee Sheryl Sandberg found a good use for her “20% time”: interviewing for the COO spot at Facebook. In news first reported on All Things Digital by BoomTown’s Kara Swisher, she’ll join the social network later this month as chief operating officer.

Quite a coup for Facebook. As Google’s vice president of global online sales and operations, Sandberg managed the division that handles sales for about 99% of the company’s advertisers. Her absence at Google (GOOG) will almost certainly be felt as deeply as her presence at Facebook, which stands to benefit a great deal from her experience building Google’s online sales and operations organization. Said Facebook CEO Mark Zuckerberg, “She has just about the most relevant industry experience for Facebook, especially since we need to scale our operations and scale them globally.”

Interesting to see a Google veteran like Sandberg jump ship for Facebook. Especially after the departures of
Gideon Yu, now Facebook’s CFO, and Benjamin Ling, who heads up Facebook’s developer platform. Perhaps the search giant is beginning to suffer from the same sort of brain drain it brought to bear on the industry a few years back. Recall this 2005 quote from LinkedIn founder Reid Hoffman?

Google is doing more damage to innovation in the Valley right now than Microsoft ever did. It’s largely that they’re hiring up so many talented people, and the fact they’re working on so many different things. It’s harder for start-ups to do interesting stuff right now.”

On Sunday, the AllThingsD team, including Walt Mossberg, Katherine Boehret, Kara Swisher and I will trek to Las Vegas for the annual Consumer Electronics Show, taking place all next week.

Such tech legends as Microsoft’s Bill Gates, Yahoo’s Jerry Yang and Intel’s Paul Otellini will deliver keynotes during the conference, but the real stories will come from the bustling floors of the convention, where we’ll be live-blogging, shooting videos and providing insights about key trends in the year ahead.

Stay tuned.

There is no gene for the human spirit.

Only one criterion : genetic perfection.”

–Taglines from the film “Gattaca”

The Genetic Nondiscrimination Act of 2007, which would prevent health insurers and employers from using genetic information in decisions of employment or insurability, will soon be signed into law. And, given recent advances in retail genetics it really couldn’t happen at a better time.

This morning the Google-funded 23andMe opened its doors for business, and began peddling its Personal Genome Service. What, exactly is a “Personal Genome Service?” Kara Swisher explains:

For [$999], a person spits out a largish saliva sample using an at-home kit, sends it in for intense analysis and then uses the site’s interactive tools to go to town with the scads of the DNA information.

“That could mean everything from analyzing personal ancestry and genealogy to determining inherited traits to finding out way too much about proclivities for a range of scary diseases.”

Why Hulu? Objectively, Hulu is short, easy to spell, easy to pronounce and rhymes with itself. Subjectively, Hulu strikes us as an inherently fun name, one that captures the spirit of the service we’re building.”

–Jason Kilar, CEO, Hulu

Hulu.com, the News Corp./NBC Universal video service that sounds like it was named by the Web 2.0 Bull—t Generator™, went into private beta today, and while critics continued to snicker at the name, most admitted the ad-supported service was, by and large, pretty decent. ”I am impressed thus far,” wrote BoomTown’s Kara Swisher. “I will, of course, reserve judgment until I get to test-drive it for a while, but in concept and tone and aims–that is, more open than I ever expected the service to be–it is off to a good start.”

Over at GigaOm, Om Malik, who ridiculed the service this past summer, reversed course and called it brilliant. “From the moment I learned about the new company, I was skeptical,” he wrote. “And now, after spending three hours or so on the service, I am ready to eat crow. And not just any crow, but rotten, six-month-old crow: I have never been more wrong. … Hulu doesn’t seem like a YouTube (GOOG) competitor. (This is yet another thing I was wrong about.) What it really is trying to do is time shift–and place shift–television on a massive scale. It’s basically an attempt to counterbalance the tight control that cable and satellite networks have over distribution. [Hulu] is the kind of service that should scare start-ups trying to develop their own distribution platforms, such as Joost. It is also the kind of service, if it can attract enough viewers, that could succeed in relegating YouTube and others like YouTube to the ‘user-generated content’ world, at least in the U.S. market.”

I’m still not sure why we added the exclamation point.”

–Yahoo! CEO Jerry Yang

Now how does Yahoo CEO Jerry Yang expect to create that “stronger culture of winning” that Yahoo so desperately needs with sad-sack pronouncements like those he made during a company conference in Half Moon Bay, Calif., yesterday? Being chief executive of Yahoo is “a lonely job,” said Yang. “It is a lonely job in the sense that you have to make some of the tough calls.”

And perhaps even slaughter a sacred cow or two. But that’s how you make the big money. Surely Yang, with a net worth of $1.9 billion, knows that.