Already in January of 2006 there were rumors that Microsoft was considering to buy Yahoo. Guess what, people are starting to talk about it again. Some time ago an analyst from Merrill Lynch declared: “the possible acquisition of Yahoo would be a strategic positive in our view.”
The acquisition would certainly help Microsoft to gain ground on the online search and advertising market segments. Google controls around 44% of all the search queries in the US (61% worldwide), while a combined MSN/Yahoo would reach almost 41%.
That being said, I am not sure whether Yahoo is the solution for Microsoft’s problems. The deal would bring more resources are a huge user base to the Redmond company. But would it make Microsoft more innovative?