File this under "Very big news in technology that's just not as exciting as gadget-laden power suits."
Early this morning Microsoft made an offer of $44.6 billion in stock and cash to acquire Yahoo! That's a 62% premium over where Yahoo's stock closed last night. That's a nice way of saying, "Hi!" Less nice is Microsoft CEO Steve Ballmer's open letter that went out across the newswire: " A year has gone by, and [your] competitive situation has not improved." Ouch.
The whole point of the offer is an attempt to knock Google out of its pole position. In spite of its many problems, Yahoo! is still the top-ranked Web portal in the world. And, apparently, money might be able to buy popularity.
That said, Google has 60% of the U.S. market share for searches, which means that, awesomely powerful as this new combination would be, anti-trust regulators are likely to let it pass. Even once they're combined, Yahoo and Microsoft would only generate 3.15 billion searches to Google's 5.63 billion. When you look at paid search advertising, the brass ring, Google has a 75% share.
So Microsoft and Yahoo could make some more money through search and take some away from Google. Now that we've got that out of the way, let's think about the actually cool things this could bring.
1. Cloud computing: Cloud computing runs applications off a "cloud" of inexpensive, distributed computers around the world instead of off one personal computer or set of servers. Google has an awesome cloud. Yahoo's is decent. Microsoft is just getting into the game. It's incredibly powerful and scalable, and has some great applications for churning data in research. MicroHoo! could throw some serious weight behind competitive projects.
2. Indexing Earth: Google Earth and Microsoft Virtual Earth are both doing some impressive things with creating a mirror world that visualizes the world. Now they're working at adding information to the project and potentially moving to a fully customizable 3D world. As noted above, Yahoo! has the biggest audience in the world. That's a crowdsourcing effort with some impressive potential. Oh, and with that cloud computer Google's running? It has a 300-year mission to make the world searchable. Maybe some competition would bring that timeline down.
3. Open Source: Yahoo is a fairly big advocate of open source. It runs on FreeBSD, for starters. Microsoft is not, but once it sinks almost $50 billion into the project, it might have to start rethinking its approach. As one of the biggest software distributors in the world, that's something to be excited about. Of course, the alternative is that Yahoo just starts acting like Microsoft.
So what do you think exciting? Scary? Generally less exciting than squirrels that hide acorns? Let us know.
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