Are MSN and Yahoo about to join forces?
While Google has been doing well when it comes to Internet advertising, Microsoft has been having so many problems that they now feel the urgent need to do something. This may lead Microsoft to pay $50 billion to acquire Yahoo in order to challenge Google. With this news Yahoo’s stock prices went up to $2.80 per share on Friday.
When you look at these 2 companies’ history, you will see that this merger definitely makes a lot of sense. However, no company wants to comment on it right now. If you look at what has been happening though you will understand it better. In the past 4 years alone Microsoft has spent billions of dollars to create MSN Search and Microsoft Digital Advertising Solutions and yet their stock prices continue to decline while Google’s stock prices continue to climb. Besides their income, there is another big difference between MSN and Google. This is the fact that most of Google’s income is from “sponsored links,” while both Yahoo and MSN are strong on graphical, animated and video ads.
Google has just recently acquired Double-Click in order to move into using display ads. Even with this move by Google, if MSN and Yahoo joined forces they would be able to provide a great #2 Search Engine. In fact, this is something that they will need to do if they are serious about online advertising. Nevertheless, there are still some obstacles including the integration of both company’s employees. A buyout will still more than likely happen in the near future.
