We know what the markets think of Microsoft's bid to purchase Yahoo!: Good for Yahoo! shareholders, not so much for Microsoft. But what do consumers think?
Apparently they favor Internet portals over the software giant. Polling data from online research firm Polimetrix show that immediately after Microsoft announced on February 1 that it intended to buy Yahoo! for $44.6 billion, consumers' impression of both companies shot up. But there's a wide gap between the two. A Polimetrix index of positive versus negative opinions shows that Yahoo!'s reputational score peaked February 1, when it hit 60 out of a possible 100. Microsoft's score peaked that day as well, but at a mere 42.
Then, as implications of the deal emerged—a possible antitrust battle, an ugly forced marriage between a staid Goliath and a restless adolescent—consumers said whoa. Within five days of the announcement, impressions of both companies had fallen, to a rating of 51 for Yahoo! and only 38 for Microsoft.
But more telling are the numbers for Google, which opposes the deal and has hinted it might help Yahoo! fend off its unwanted suitor. Google's approval score peaked at 77 on February 1 and has dipped only slightly since then. "Google is a much stronger brand in the eyes of consumers than either Microsoft or Yahoo!" says Ted Marzilli, one of the data gurus at Polimetrix. Unlike Yahoo! or Microsoft, Google consistently ranks among the research firm's highest-rated brands.
The numbers don't directly explain why consumers like or dislike each company, but the ratings tend to rise and fall with news events, allowing informed interpretation. How consumers view each company:
Microsoft, approval rating, 38 (as of February 6): The company's software is ubiquitous—but hardly beloved. Consumers view new products like Office 2007 and the Vista operating system as different but not necessarily better. Almost everybody has experienced a computer crash, and Microsoft often gets the blame. The software giant is also clearly regarded as a cutthroat competitor that is frequently sued by small companies claiming monopolistic behavior.
Yahoo!, approval rating, 51: Consumers generally have positive interactions with Yahoo! But slipping profitability and negative news, like last week's announcement that the company plans to lay off 1,000 workers, weigh down the company's reputation. Frequent news reports about how Yahoo! is falling behind Google don't help either.
Google, approval rating, 75: Though it's fast becoming a behemoth, Google still carries credibility from the days when it was a start-up and an underdog battling established giants. As with Yahoo! most people's interactions with Google are positive—the search engine helps them find what they want. The company's reputation suffered briefly amid criticism of its policies in China, where it limits some searches, but bounced back. "People consider Google to be benign," says Marzilli, "but who knows—in 5 or 10 years, people could see Google much as they see Microsoft today."