How It Came To This: Virals vs. Microsoft

Microsoft recently published a letter from Kevin Johnson, President of Microsoft's Platforms & Services Division, to his team. The letter details Microsoft's interest in the Yahoo! merger, and the benefits the company and its employees will gain if the deal goes through. The letter seems to focus entirely on a friendly purchase, though Microsoft has already authorized a proxy fight for Yahoo! NYTimes.com DealBook looks at the letter as a "pep talk" to employees in preparation of a protracted and dirty fight, despite the letter's gentle nature. I'm inclined to agree.

But how did it get to this? How was such a huge, and by many accounts, generous, offer so roundly rejected by Yahoo? Let me propose a novel answer; you're to blame.

Yes, you - the average Flickr user, Digg poster, YouTube browser. You embraced virals that broadcasted the "evil empire" stereotype of Microsoft and directly appealed to Yahoo to either reject the deal--or to hold out for more money. You flooded Flickr with images opposing the purchase, pledging to keep Microsft's "evil grubby hands" off of Flickr. You Dugg a video of Sphigler advising Jerry Yang to pull out an iPhone during his meeting with Microsoft as a negotiating technique. In fact, you Dugg it twice. According to Ran Harnevo, CEO of 5min.com, which created the Sphigler viral (below), the video may have been directly responsible for the decision by Yahoo's board. "I received a mail from someone at Yahoo that everyone had seen the video," he said, "including Jerry Yang."

In short you lived up to your honorific as Time's Person of the Year. You tanked the biggest deal of the decade. At least for now.