Microsoft announced its intention to buy Yahoo! for 44.6 billion dollars on February 1st. This means the share price Microsoft offered for Yahoo! is 31 dollars per share, a value lower than in the past weeks and months. Yahoo’s declining value, and recent moves towards cutting down on work force, are all part of something many see as a crisis. In that sense Microsoft’s offer is timely and balanced. There have been many speculations already about what a merger between the two companies might produce as a result. Both companies have worked on improving and developing their search presence in the past months, and both have succeeded in areas related to search, but none has achieved any significant increase in search scape share against Google. This post tried to compare the two companies’ online efforts and determine which was a “winner” in each area. It seems Microsoft would have a lot to gain by simply integrating Yahoo! but also a lot of area where a merger would actually produce something competitive unlike each company’s independent effort. One such area would be local maps where Yahoo’s interface would be a great improvement on Microsoft’s features. Perhaps this press release by Microsoft sums up their goal best:

“Our lives, our businesses, and even our society have been progressively transformed by the Web, and Yahoo! has played a pioneering role by building compelling, high-scale services and infrastructure,” said Ray Ozzie, chief software architect at Microsoft. “The combination of these two great teams would enable us to jointly deliver a broad range of new experiences to our customers that neither of us would have achieved on our own.”

Interesting to say, Microsoft would have probably bought Facebook, if it was available for sale, although they chose to ensure an ad platform instead, by purchasing a Facebook share. Personally, I think the merger would bring improvements for those who use the two companies’ services and a more solid search alternative to Google, but there are opinions that Microsoft is again heading for monopoly issues again. Google hasn’t said anything yet about Yahoo!, probably because their ownership of it would probably be regarded as search scape monopoly … or would it?

Yahoo! is still thinking about Microsoft’s offer, but there are rumors others may be interested in Yahoo! as well - they’ve certainly got the cash.

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