If Microsoft gets its paws on Yahoo, it'll be a disaster for both companies. The reason Microsoft hasn't managed to build a decent online presence in, what, twelve years is not that there are no smart people there. It's that Microsoft is constrained by the need to protect its shrinkwrap software business. Windows and Office bring in maybe $50 billion a year (revenues), at absurd profit margins. Google wants to replace those megabucks with the (much smaller) ad revenues from cloud-computing services like Google Docs. Microsoft's efforts at competing are half-assed and hamstrung, because MS doesn't want successful network services. (This is also why MS uses its crappy web browser's huge market share, gained by exploiting a monopoly, to retard the development of web standards: they want the web to suck.)
If the deal goes through, Microsoft's interests become Yahoo's interests, and one of the first great web companies will be conscripted into a rearguard action against the web itself.
2/1/08
