Microsoft Acquisition of Yahoo! May be Kaput

Dennis Faas's picture

A few weeks ago, the rumored acquisition of Yahoo by software behemoth Microsoft appeared to be a done deal. There was some motive for it, as the pair lagged behind hegemonic web power Google in both search and advertising functionality.

And with the latter acquiring major ad agency DoubleClick a few months ago, the impetus appeared to be on Microsoft to match such a move. Despite the sense it seemed to make at the outset of May, it's now looking more and more as if Microsoft is no longer interested in the Yahoo deal. (Source:

So, what's changed in recent weeks?

Most notably, Microsoft's decision to purchase DoubleClick rival aQuantive. For a reported $6 billion, or over $66 a share, the Redmond-based company turned up the heat on its competition on the web and elsewhere. Bringing aQuantive on board should drastically improve Microsoft's "adCenter", the central platform for its future marketing initiatives.

What that means for the Yahoo rumors is that Microsoft no longer requires the big Y's Panama online ad platform. Confirmation may have come via Yusuf Mehdi, Microsoft's Senior Vice President and Chief Advertising Strategist. When asked by the media if his company was still in negotiations with Yahoo, Mehdi replied, "we have all the pieces we need to be one of the top ad platforms." (Source:

Translation? We're good to go.

Other than a few small tinkers to the formula (and a massive $50 billion acquisition of Yahoo does not apply), Microsoft seems to believe it can resume its pursuit of mighty Google.

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