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Google objects to MS/Yahoo, may ally with Yahoo

updated 10:55 pm EST, Sun February 3, 2008

Yahoo Mulls Google Deal

Google considers the possibility of a Microsoft acquisition of Yahoo anti-competitive and possibly threatening to the Internet as a whole, says company Chief Legal Officer David Drummond in an official blog. The official argues that Microsoft's historic approach of establishing and extending proprietary standards is opposite to the very notion of the Internet; a Yahoo deal could potentially recreate Microsoft's leverage with Office and Windows on a much wider level, Drummond says.

"Between them, the two companies operate the two most heavily trafficked portals on the Internet," he explains. "Could a combination of the two take advantage of a PC software monopoly to unfairly limit the ability of consumers to freely access competitors' email, IM, and web-based services?"

Microsoft has issued a formal rebuttal to the argument, dismissing notions that an acquisition of Yahoo is an attempt to create a monopoly and contends instead that Google's 75 percent control of search revenue means that an acquisition of Yahoo would create more competition rather than less. "The alternative scenarios only lead to less competition on the Internet," Microsoft General Counsel Brad Smith claims, also arguing that Microsoft supports openness.

Regardless, sources within Yahoo are allegedly reporting that the search engine firm is investigating the possibility of allying with Google as an attempt to stave off a hostile Microsoft takeover. The plan would revive earlier talks between the two companies and may have been spurred along by a call by Google chief Eric Schmidt to Yahoo's own chief Jerry Yang, according to a Wall Street Journal report.

Other large financial, media, and technology firms have also expressed interest, though no bids have been made apparent, the insiders say. Yahoo is believed by some to be aggressively seeking alternative offers after considering the Microsoft offer as a threat rather than the invitation suggested by the latter's official reasons behind the proposal.



By Electronista Staff
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  1. climacs

    Forum Regular

    Joined: Sep 2001

    0

    who to favor?

    I don't like the idea of MS owning Yahoo but then again, Google + Yahoo is a monopoly while paradoxically, MS + Yahoo would create more competion and yet in the long run, not good for competition.

    This will get interesting...

  1. bobolicious

    Dedicated MacNNer

    Joined: Aug 2002

    0

    MS supports openness...?

    ...that statement alone should be enough to get Drummond into hot water...

    I suspect MS may be panicking at the paradigm shift taking place in 'iCommerce' and that the chances of IE losing it's highly proprietary lockdown may have more than doubled with iPhone's Safari & Yahoo push-IMAP email...

  1. testudo

    Forum Regular

    Joined: Aug 2001

    0

    Re: over the top

    Google considers the possibility of a Microsoft acquisition of Yahoo anti-competitive and possibly threatening to the Internet as a whole,

    Threatening to the internet as a whole? Now that's laughable. The very nature of the internet makes it impervious to such threats.

    The official argues that Microsoft's historic approach of establishing and extending proprietary standards is opposite to the very notion of the Internet;

    Right, because there's nothing proprietary about Google. It's all Open over there. What are they expecting MS/Yahoo to do, change the entire TCP stack or something.

    "Between them, the two companies operate the two most heavily trafficked portals on the Internet," he explains. "Could a combination of the two take advantage of a PC software monopoly to unfairly limit the ability of consumers to freely access competitors' email, IM, and web-based services?"

    No, because people would just bypass the portal (it's not like you go to Yahoo to read your gmail). MS could attempt something with Windows (just like Apple could do with OS X, Sun with Solaris, RedHat with Linux, etc) but it wouldn't work and quickly be defeated.

    Plus, there's no easier way to completely lose your customer base if you can't get to some website because Yahoo says you can't go there.

    Of course, hearing about how bad the merger would be from the main competitor who would face extended competition by the merger doesn't really hold much water. You need some third-parties to express their outrage.

    Oh, and bobolicious, Drummond isn't saying the support openness. That was Smith. And they do (to a point).

  1. Peter Bonte

    Fresh-Faced Recruit

    Joined: Aug 2001

    0

    @testudo

    MS can easily make sites, music, video and most other services Windows only. We have seen this with both there DRM schemes, not standard compliant browser and website apps. Not to forget browser games and apps with directX and other requirements making them Windows only.

    This is absolutely a threat for the open internet!

  1. ClevelandAdv

    Fresh-Faced Recruit

    Joined: Jul 2004

    0

    MS/Yahoo ok

    While I don't generally like the way MS does business or have much love of their bloated, clunky products. I don't see this merger as anti-competitive. Stronger competition would be a healthy thing.

    The problem is MS would find a way to ruin Yahoo to the point where no one would want to use it unless they did not know how to change their PC settings.

  1. testudo

    Forum Regular

    Joined: Aug 2001

    0

    Re: @testudo

    MS can easily make sites, music, video and most other services Windows only.

    So, go to other sites. Again, no one forces anyone to go to one site over the other. That's the democratic process at work, esp. on the internet.

    We have seen this with both there DRM schemes, not standard compliant browser and website apps. Not to forget browser games and apps with directX and other requirements making them Windows only.

    Now you're bringing up platform stuff, not internet stuff. But how successful is MS's DRM schemes, anyway? Not very. IE's lack of standards has been hurting them for years.

    This is absolutely a threat for the open internet!

    No, it's only a threat if people are too lazy and just stick with MS supported sites.

    Wouldn't it be nice if you all would put as much concern and worry into government controls over the internet and invading your freedoms. I think MS should be the least of your concerns...

  1. Tim_s

    Fresh-Faced Recruit

    Joined: Jul 2006

    0

    yeah sure

    "I think MS should be the least of your concerns..."

    Isn't that how we ended up with Microsoft owning a monopoly of the PC business in the first place? Didn't people say we could Microsoft to do the right thing? Have they EVER done the right thing? No!

    Whenever Microsoft goes into acquisition mode, I get worried. That's not to say that I want to see Google and Yahoo to join forces. But at least let's look at who's been more open with their standards. And it ain't Microsoft.

    Microsoft would use Yahoo as a battering ram against any OS other than Windows. You KNOW it's true. How long would it be before DirectX was a requirement to view Yahoo. Not to mention the continuing bastardization of html.

    No thank you.

  1. Peter Bonte

    Fresh-Faced Recruit

    Joined: Aug 2001

    0

    re: @testudo

    "it's only a threat if people are too lazy and just stick with MS supported sites."

    Thats the profile for about 85% of the users and 90% won't ever notice it because they are on Windows machines. With Yahoo they would own a huge part of the internet content and that is dangerous. Your smart enough to know this so don't play dumb.

  1. Deal

    Mac Enthusiast

    Joined: Apr 2001

    0

    Really not a problem

    I could care less either way. Google+Yahoo would leave a void that would be filled by a new upcoming search engine, probably enough to dethrone the conglomerate (just like Google did to Yahoo) and MS+Yahoo will end in Microsoft taking the parts they want and s******* them up so bad it will be a non-factor. Yahoo would be swallowed up and gone and MS would be the same old company with a lot of wasted time and money.

    Either way, it really doesn't matter. Google should be happy that somebody is going to ruin their competitor.

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