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Quarter-End Insights

Our Outlook for the Media Sector

Yahoo and Microsoft are standing by as Google strengthens its wide moat.

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The  Microsoft (MSFT) and  Yahoo (YHOO) saga continued to be a dominant story in the media industry in the second quarter. We think this issue is relevant as it demonstrates the growing importance of online advertising at the expense of traditional media. As we pen this article in mid-June, talks between Microsoft and Yahoo appear to be over. We could rattle on and on about the poor corporate governance and lack of regard for shareholders, but in short, we think Yahoo's management did its shareholders a great disservice by not getting at least $31 per share from Microsoft when it had the chance.

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Michael Corty does not own shares in any of the securities mentioned above. Find out about Morningstar’s editorial policies.