Yahoo – either a word for a hick or a hayseed, or an exclamation of delight. I know what my definition would be if I were part of Yahoo's empire today.

When the world's biggest software company places a bid in your lap which is 62% higher than your share price I suspect it will be large lattes all round for Yahoo's webheads.

Well, at least there'll be some rejoicing for those who are left after the 1000 lay-offs announced earlier in the week, because things haven't been exactly on-line for this old boy of the internet boom since it was overtaken by upstart Google in 2004.

Google is now eight times the size of Yahoo, and its company name is now a verb in any language.

So, why is Microsoft interested? It's all about customer base and advertising.

Online advertising has been the fastest growing ad medium for the past three years – its outlook from £20bn now doubles to £40bn by 2010. That's up for grabs.

Google has perfected a program called Adwords for its advertisers, Yahoo's Project Panama is not so good.

So that's the challenge, and with Microsoft's billions, a big ability to spend on research and development and plenty of 'synergies' between the two relatively mature companies, Google may find itself with some competition.

Posted by Michael Wilson, Business Editor

Comments

[Elizabeth Davies Cape Town 2 Feb 2008 14:19:18]

Michael
What was that old saying about"looking gift horses in the mouth". But what microsoft wants microsoft gets I suppose. If you have enough money you can buy a soul .

[Khalid 2 Feb 2008 06:22:57]

Sir
As with everything branded Microsoft there will be a bug that many a googling eye will find, whilst many shout yahoo in delight.
Microsofts' emergence into the search and find engine market, whilst perceived by many as a move to dominate the market will however be met with vigourous scrutiny whilst in reality both brands as you say provide pretty much the same,however one appears to be better than the other purely for reasons of bundled software inclusion.
Whether the eyes google or the arms reach for http://www.sky.com in delight, one thing for sure ["I'm In The Mood For Dancing"} and as such need to search for the ["Nolans"] and ask Sir Julian, should I March or stay soft?