Outsourcing its search advertising to Google (NASDAQ: GOOG) may not be a viable option for Yahoo! (NASDAQ: YHOO) as it fights off a takeover bid from Microsoft. The Wall Street Journal says that a transaction "doesn't appear likely because of Google's concerns about the intense regulatory scrutiny it could attract, given Google's and Yahoo's significant shares of the Web-search and online-advertising markets."
Depending on which measurement service regulators use, the No.1 and No.2 search companies could have 80% of the US market. The government might think that is a bit excessive.
If the Google plan is not an option, it does not leave much room for Yahoo! to keep Microsoft off its back. There are still rumors of interest from Time Warner (NYSE: TWX) and News Corp. (NYSE: NWS), but they are probably not willing to pay the rich price that Microsoft will and don't have the largest software company's balance sheet.
Which is to say that the odds Yahoo! will lose its independence keep going up.
Douglas A. McIntyre is an editor at 247wallst.com.
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Reader Comments (Page 1 of 1)
2-19-2008 @ 4:29PM
Rex said...
Microsoft is buying a loser (Yahoo). Google is as far ahead as a search engine (and will stay that way) as Microsoft once was so far ahead it with it's OS Windows.
Perhaps Google should just buy Microsoft.