MS vs. G

By Liz | Comments (0) | Trackbacks (0)

Looks like Microsoft and Yahoo! will become one after all.

SEATTLE (Reuters) - Microsoft Corp (MSFT.O) said on Monday it may borrow money for the first time in its history to fund a portion of its $44.6 billion unsolicited offer for Yahoo Inc (YHOO.O).
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Microsoft also said it expects Yahoo’s board to agree to the deal quickly, but Yahoo said over the weekend that it expects to take “quite a bit of time” to weigh all of its strategic options including remaining independent.

A source familiar with Yahoo’s strategy said it is considering a business alliance with Google Inc (GOOG.O) to fend off Microsoft’s offer.

Looks like Google is backed up against the ropes with this. And Yahoo! is a little worried too. The article says that Microsoft is already offering Yahoo! shareholders “either $31 in cash or 0.9509 of a share of Microsoft common stock”. There’s even some speculation that Microsoft is buying publicly held shares of Yahoo!

Google seems a little worried with their blog post about it.

So Microsoft’s hostile bid for Yahoo! raises troubling questions. This is about more than simply a financial transaction, one company taking over another. It’s about preserving the underlying principles of the Internet: openness and innovation.

Could Microsoft now attempt to exert the same sort of inappropriate and illegal influence over the Internet that it did with the PC? While the Internet rewards competitive innovation, Microsoft has frequently sought to establish proprietary monopolies — and then leverage its dominance into new, adjacent markets.

Some folks say that Google is exerting inappropriate influence over the Internet with their webmaster guidelines (though in fairness, they do so only with their own search engine and anyone who doesn’t want to be part of their search engine can easily opt out…heh).

So, is this a wrestling match between two giants trying to control what the masses have access to? What happens if they cancel each other out? Can you imagine what the anti-trust lawsuits will look like? Google files one, Microsoft files another, and so on ad nauseum. It could benefit the little folks who are just trying to be a part of the Internet and seem caught between a rock and a hard place. Couldn’t it?

I wonder if a particular get-paid-to-blog place is going to wait this little standoff out, to see who comes out the winner, before they roll out their new strategy. Everyone who has been waiting so patiently will have to wait longer. If Microsoft wins this round things can only get that much more interesting online.

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