Microsoft+Yahoo=AOL/Time Warner?
It's clear that Yahoo is struggling against Google, and it's clear that Microsoft wants nothing more than to be important in the online services world. But the combination of these two behemoths, neither of whom have been particularly innovative with technology or customer acquisition of late, is the next AOL/Time Warner debacle.
Does anyone think that the merger of AOL and Time Warner was a success? Does the marriage of two companies that have no clear strategies ever make sense?
Microsoft hasn't proven that it can take advantage of this scale of web property and has wasted a huge amount of time and dollars with all the Live.com junk. Yes, MS should move into new markets and look to the future but Yahoo is a massive undertaking with a completely different culture.
The other big question is how long search and advertising are the holy grail. Odds are something else will come along and it will be Google or another startup that figures it out before Yahoo and Microsoft.
According to Jason Maynard at Credit Suisse, this is going to be a tough slog.
We expect Yahoo to pursue every avenue to fight the acquisition and believe the ouster of Terry Semel from the board signals that. While management is likely to pursue other combinations like Yahoo/MySpace/NWS, Yahoo/TWX/AOL, and YHOO/AT&T, as well as more exotic options, we believe that Microsoft's strategic and financial advantages will ultimately overcome management resistance, particularly in light of investor and employee frustration over the lack of strategic direction and failure to execute the company has demonstrated. However, we would not discount the possibility of Microsoft being forced to use a tender offer to move the process forward.
Dave Rosenberg dishes up "Software, Interrupted" with nearly 15 years of technology and marketing experience that spans from Bell Labs to multiple start-up IPOs to open-source enterprise software companies. He is co-founder of MuleSource and currently serves as the general manager of Hardy Way. He is a member of the CNET Blog Network and is not an employee of CNET. Disclosure. You can contact Dave via e-mail at softwareinterrupted@gmail.com or follow him on Twitter @daveofdoom. 
> something else will come along and it will be Google or another startup that figures it
> out before Yahoo and Microsoft.
Would this purchase push Google into bidding more seriously on the 700MHz spectrum auction? Will they be actually bidding to win now or still simply bidding to make sure some of its open access requirements are imposed on an eventual winner?
Google sells ads and the cellphone/portable communication market is much bigger than the internet and still untapped.
Of course, 700mhz makes no sense for data so a later swap with Sprint/Nextel for some of thaeir 2.5-GHz WiMAX licenses which are much better for data makes more sense.
I'd repeat what I heard about 'a new era in cellular and internet connectivity' but I'd have to rip out my own tongue afterwards..Needless to say a Google venture in the mobile market would still leave Microsoft two steps behind.