Tech Beat Microsoft and Yahoo Russian Roulette - BusinessWeek

Game theory is always one of the more mathematical modeled issues, so when you get a chance to see an easy one, you grap it, here is just such an analysis:

Tech Beat Microsoft and Yahoo Russian Roulette - BusinessWeek:

"Yahoo and Microsoft have also done their best to increase the others cost and risk of delaying. This month, Microsoft set a three week deadline, set to expire April 26, for Yahoo to begin negotiating. Otherwise, Ballmer would move ahead with plans for a proxy fight, including nominating a new Yahoo board of directors likely to approve an even lower Microsoft bid. The move is intended to make Yahoo shareholders more nervous about waiting for a better bid, and thus more likely to either push for the deal or sell their stock in anticipation of a lower bid, weakening the company’s financial position. “I think Microsoft is wise in trying a first-and-final strategy,” says Robert Hansen, senior associate dean at Dartmouth’s Tuck School of Business who studies game theories applications in business. “That’s a good strategy, if the target believes you are committed to it.”"