Microsoft and Yahoo In Talks…Again!

You will remember that just under a year ago Microsoft launched a takeover bid of around £22 billion for the internet company Yahoo, which after a lengthy three month debacle resulted in the deal falling through and making many shareholders pretty unhappy. But less than a year on, and a new person in charge at Yahoo, they have started talking again.

This time around though they aren’t talking about any kind of takeover (directly anyway) – the main objective is to pool their resources in the aim of halting Google’s growing dominance on the internet market, something that will benefit both parties greatly.

This mutual worry is demonstrated very well by the new figures released by ComScore which shows that Yahoo only has 20.6% of the market whilst Microsoft has even less at 8.2% and both percentages look set to decrease as Google’s already large share increases.

So far nothing of any great importance has come out of them as the talks are said to be only “preliminary and wide ranging” but it is fairly obvious that both companies need to do something soon before they slip into the realms of the anonymous with regards to their internet presence which is at best floundering – just think to yourself when was the last time you used anything apart from Google to search?

However despite the fact that both sides have a lot to gain from working together you cannot help but think that the talks will be in Microsoft’s favour. Unlike Yahoo they don’t have that much to lose: their search engine never was that popular and have therefore not lost as much as Yahoo has with Google’s rise, and also they have their software dominance to fall back on if they do lose all hope in this particular market.

Yahoo on the other hand have successively lost market share, contracts with companies (like HP and Acer) and their ‘Chief Yahoo’ (i.e. Chief Executive) a title which has now been passed Carol Bartz who aims to revitalise the company and give it a direction which it previously lost.

Perhaps a new face is what Yahoo needed as a wake-up call, and if they are successful then maybe they could start to fight back against the growing Google dominance – but if negotiations are successful you can be sure that you won’t hear about it until she wants you to as she is notoriously tight with regard to media coverage:

“I said this to Mr. Ballmer: I will not negotiate with you and 30,000 of my closest friends. I will negotiate privately” – Carol Bartz, who also told shareholders that “if something happens, you will know about it then”. Evidently this will be a tighter set of negotiations than those last year.

But will they achieve anything? Yahoo have already let 1,500 employees go, will Microsoft working with them really help? The odds are probably against them as Google’s advance shows no signs of stopping and Yahoo/Microsoft fail to come up with anything inventive (choice of colour schemes vs. Google Street View, not much of a choice!) but surely this era of dominance must come to an end at some point?

But who will take the baton then? Could it be Wolfram Alpha which we reported on recently? Will it be Twitter that makes the big money (- assuming they resist buyout interest from Google) and become the next goliath out there?

Via – Guardian

Related Pages:

1. Microsoft and Yahoo Finally Strike A Search Engine Deal
2. Bing Search Engine More Popular Than Yahoo?
3. Yahoo Fulfils Grim Promise to 1,500
4. Microsoft Office 2010 To Include Free Online Web Versions
5. Ask.com Brings Back Jeeves

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