Microsoft Offers to Buy Yahoo for $44.6 Billion

In the wake of Yahoo laying off people, Microsoft sent an offer of $31 per share for the company on Thursday, January 31. Microsoft's offer is over 62 percent above the closing stock price for the day, but is still below their year high of just over $34 per share.

What does this mean for Yahoo? Yahoo was the first search engine, surviving over ten years of innovation, making themselves competitive for all these years. What will be come of them if they accept Microsoft's offer? Will Yahoo as we, the Internet community, know it cease to exist? They already partner in innovation with Yahoo Messenger and Windows Live Messenger. Will one of the messengers cease to exist if the offer goes through? Will there be a need for both?

What does this mean for Microsoft? They will be gaining a lot of innovation with Yahoo's program base. With their acquisition of Yahoo, Microsoft will have access to services such as Geocities and Flickr. Along with that, Microsoft will have access to things such as 360, games and chat. All of those areas where Microsoft has been unable to keep up with the innovation.

What does this mean for the Internet users? I think that, while it sounds like Microsoft is taking over the world, in the end, the Internet users will be happier. With Microsoft and Yahoo's possible merger, it could eliminate one of the Instant Messaging clients, bringing people from both services closer together. For instance, I have both but prefer Windows Live Messenger. A lot of my friends prefer Yahoo, so this would bring us together on one client.

What else does this mean for the Internet users? It means that their combined technologies can push their innovations ahead and possibly be more competitive with Google. I think that Yahoo and Microsoft joining forces will be a benefit for Internet users. It'll make Google have to work harder to keep up with the mega-force that Yahoo and Microsoft can make. If they make the most of their combined forces.

The financial aspects of it all? Yahoo's stock has risen by over 9 points since this announcement while Microsoft's stock has dropped by about 2 points. The only thing that could possibly stand in the way of Yahoo and Microsoft's merger is the concern of antitrust problems. However, analysts don't believe that this will be a problem, due to Google's dominance in the online search market. It may, though, drag the deal out longer than necessary because of the amount of scrutiny it will be under.

Sources:
http://news.yahoo.com/s/ap/20080201/ap_on_hi_te/microsoft_yahoo_antitrust
http://news.yahoo.com/s/nm/20080201/media_nm/microsoft_dc
http://finance.yahoo.com/