Monday, July 07, 2008

Microsoft Throws Weight Behind Yahoo Board Takeover Bid

For those of us in the technology industry, the decade-long back-and-forth between Microsoft and Yahoo has been fodder for bar room conversations.

The two giants were two heavyweight fighters vying for supremacy over each other as the Web expanded from its humble origins to a full-fledged part of daily life. Yahoo was always the plucky upstart, creating search tools and other Web-applications that increasingly pried market share away from the Redmond, WA behemoth, a fact that made everyone feel a bit better about Microsoft.

Then came Google. Suddenly both companies seemed so much…smaller.

Now their back-and-forth was less a heavyweight fight and more a battle for survival. Few think the two can wage a long-term, victorious fight on its own against Google. But neither wants to cede their respective positions in the tech sector.

Earlier this year, it looked like Microsoft might finally succeed in buying Yahoo, creating a combined search and Web-application business that would dwarf Google. Instead, Yahoo CEO Jerry Yang quashed the deal.

That prompted raider Carl Icahn to launch a bid to oust the current Yahoo board, claiming that was the only way to restart acquisition talks (which, for the record, would make Icahn a pretty penny). Yahoo denied this, saying Microsoft was welcome to resubmit a bid whenever it wanted.

This sounded good.

Until Microsoft said today that Icahn's analysis that the company would only come back to the table with a new board was correct.

That makes those of us who follow the tech sector very happy because it sets up a throwback confrontation between old stalwarts: Yahoo and Microsoft.

Posted By Brad King at 04:15 PM
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