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Microsoft/Yahoo! Merger a Good Idea?

Posted by ryuzaki0 on from the the-big-get-bigger dept.

NorbMan writes "Last month there was speculation about Microsoft's interest in joining forces with Yahoo! to battle Google. Today, a Merrill Lynch analyst recommended a Yahoo! takeover by Microsoft. From the article: "A Yahoo/MSN-Microsoft combination would have garnered approximately 41% share in the US of search queries [in April] versus Google with 44%.""

3 of 186 comments (clear)

  1. Only about search? by Anonymous Coward · · Score: 4, Informative

    Does anybody use Yahoo for more than just searching? What about their excellent portal, My Yahoo!? It's the one place I always start from to get my daily and intra-daily doses of news, including slashdot. It's great for tracking stocks. It's highly customizable.

    What happens when Microsoft gets its hands on Yahoo? How long before this great site stops working properly on anything but IE? Can people just switch to Google and find this kind of service? Does anybody do this anywhere near as well as Yahoo?

  2. Re:Alternative search engines by Moebius+Tripp · · Score: 3, Informative

    FWIW, this is one of the many reasons I have gone to a meta-crawler. I don't even trust the page ratings from any of the big players. I use Dogpile and find I get a slightly more effective search.

  3. Re:Very bad idea by SavvyPlayer · · Score: 2, Informative
    Huh? Duoploy? I assume you mean Microsoft and Google?
    Yes, that's what TS said.

    Are you suggesting that having just two companies competing against each other for market share has no advantages compared to a monopoly?
    No, the point TS was making is simply that for any given market, more competitors > fewer competitors. Therefore any way you slice it, this proposed merger would be better for Microsoft/Google than the search market in which they compete.

    Look at Intel/AMD.
    Intel and AMD have not until very recently shared a level playing field. 5 years ago Intel owned 80% of the PC processor market, to AMD's sub-20%. Once both market and marketshare stabilize (limiting new growth opportunity), both companies will begin to focus on minimizing risk, establishing price equilibrium and direct R&D spending at new markets in search of new growth opportunities. Only if there are no such growth opportunities will these competitors turn up the heat on one another.

    The only problem is if they work together to control the market and then share each others profits, but I cannot see that happening.
    While outright boardroom collusion may not occur (right away), the incentives and conditions associated with duopoly competition make fertile ground for tacit collusion.

    What do CPU cycles and information have in common? Both are commodities. Once a commodities market is established, production itself only represents a growth opportunity during periods of increased global demand. Innovation is a calculated risk such companies are often not willing to take when tacit collusion promises steady cash flow.