Tech assimilation is certain

In the age of merger-happy technology firms, your typical Fortune 500 tech company starts to resemble the Borg. “You will be assimilated. Resistance is futile.”

So when rumors hit that Apple wanted to buy media darling Twitter and game giant Electronic Arts, I was all like, “Meh, OK.” Never mind that it didn't make a lick of sense and that Twitter still lacks any kind of sensible business model. Never mind that Apple never does big mergers (though to be fair, it was the 1996 purchase of NeXT Computer that brought Steve Jobs back to the company). It seemed like just another thing, especially in today's market, where consolidation is the name of the game, whether we like it or not. So for this week, I'll chronicle some of the odd mergers that made ideas like that seem so commonplace.

Skype was a popular audio chat and videoconferencing application. So naturally, in 2005 auction site eBay came along and bought it. At the time, it made no sense. In 2009... yep, still makes no sense. I mean, do I really want to have the option to call this creepy, bespectacled guy who wants to buy my Beanie Babies and dusty old video games? Apparently somebody at eBay agrees with me, as the company announced plans last month to spin off Skype with its own stock offering.

Google was once strictly search. It's what they're good at, and they do it very well. When they started to diversify, they started turning some heads. Picasa, Blogger and FeedBurner, for example, are all pretty ancillary to Google's core mission, not that any of that matters when you've got the gross national product of a small country to work with. And let's not forget the shining jewel of unexpected buyouts – YouTube. Just a year after its introduction and rise to fame, the site was snapped up by Google in 2006. Google already had a (terrible) video site at the time, which made things kind of awkward for a little while as both sites kept running.

But sometimes these mergers and shopping sprees don't happen, usually because of blind corporate greed. The shining example is the soap opera that was Yahoo and Microsoft. Last February, Microsoft sent an unsolicited $44.6 billion bid for the distant second-place Internet search company. For a company in Yahoo's position, they would be stupid not to take that kind of money. For comparison, the assets of the search leader, Google, are worth a relatively paltry $31.8 billion. Social networking Web site MySpace went to News Corporation for $580 million.

And guess what? They didn't take it. Microsoft's chief executive officer, Steve “Developers Developers Developers...” Ballmer, pulled the deal three months later. Yahoo's shareholders were none too happy, and Yahoo's CEO Jerry Yang was later forced to step down. Oops.

Another example of back-room drama comes from Sun Microsystems. The server firm, also the developer behind tools like Java and OpenOffice, nearly merged with IBM until April, when talks suddenly broke down. Reportedly the $7 billion offer was not enough to pay for some executives' second jacuzzis and gold-plated Ferraris. Several weeks later, they merged with Oracle for nearly the same amount. It's funny how things work.

So this is my last column for the year. It occurred to me I've been doing Tyler Tech (and its predecessor, the similarly alliterative Towson Tech) for more than two years now. It's a little scary. Thanks to everybody for putting up with me this whole time, and I'll see you in the fall. If you enjoy putting up with me, however, keep tabs over the summer by going to the brand-new Tyler Tech blog on www.thetowerlight.com.