It is rumored that Microsoft offered $80 billion for Yahoo, which they promptly rejected. If nothing else though, Yahoo shares rose 4.4 percent. According to the Wall Street Journal, a faction within Microsoft is lobbying to have the company purchase a stake in the search provider, but the plans are currently on hold.
With all of the money Microsoft is dumping into its MSN Group and Live Software, it seems as though they are looking to grow their business by a little more traditional means than through acquisitions. A partnership might happen, but I think it’s unlikely.
Honestly, what does Microsoft stand to gain? A search algorithm? The social networking side of Yahoo? The immediate search presence that a partnership would spur? Its true that Microsoft has an amazing amount of cash, but I don’t think they want to be in Yahoo’s market.
In actuality, Yahoo would probably stand to gain slightly more. If they were acquired by someone like Microsoft, they might finally get their ad network, namely YPN, up to par as far as optimization. Their stocks would look a little more valuable as well.
In the long run, only time will tell. If anything were to happen, it would be bad news for Google. Then again, is it possible for anyone to keep up with them?