Microsoft Now Wants Parts of Yahoo! “Yahoo!’s Search and Advertising”

Submitted by lalit on May 19, 2008 - 8:26am.

Microsoft said on Sunday that it is crawling back to Yahoo, to bargain an unspecified deal with the company. The software giant has proposed an alternative that would involve a transaction with Yahoo, but not an acquisition of all of Yahoo. Though Microsoft didn’t provide any details about the proposed transaction but it is very obvious that it involves Yahoo’s search and advertising business. Search and advertising were the two main reasons why Microsoft wanted Yahoo in first place. It is very clear that Microsoft is too desperate to get Yahoo’s search and advertising business, as they don’t have any clue how they would compete with Google on their own. But the truth is combining two losers won’t result in a winner. Combined market share of search and advertising business of both Yahoo and Microsoft will be around one fourth of what Google has today. So unless the combined company comes up with a better way to do search and online advertising I don’t see any hope of Microsoft making a dent in Google’s market share.