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In the last decade, and particularly in the last 5 years, the Internet community has witnessed the quick surge to power of two big Internet 'giants': Google and Microsoft. While the first was originally created as no more than a research project by a couple of university students, its innovative and peculiar way of classifying search results based on the number of links pointing to a particular page (the notorious PageRank) soon lead to an exponential growth in popularity, and ultimately became the leader in the web search market by a wide margin on both Microsoft's MSN Search and Yahoo Search.

Soon, however, it became clear that the 'war' between Google and Microsoft was still far from being over. In the last few years, despite its simple appearance and site design, Google has constantly grown more and more complex, struggling to offer new and sometimes unique products to its users, some of which are explicitly designed to create a direct rivalry with Microsoft products (see Google Docs, a viable alternative to the Microsoft Office suite).

Seen in this context, the aims of the recent proposal of acquisition of Yahoo made by Microsoft seems clearer than ever. While analysts generally agree that such a transaction would not be a serious harm to Google's undiscussed leadership in the search market, it would certainly be a huge step forward for the 'big M' folks who, by uniting Microsoft's great economical means and the advanced Yahoo technology (and market share) in both search and advertising, could still become a major threat to Google.

Microsoft's offer of $44.6 billion, roughly equivalent to 63% of the current Yahoo stock value, seemed like a reasonable deal at first, considering that the company is currently facing its eighth consecutive trimester falling in both revenue and market share. However, as it was to be expected, Yahoo executives made no immediate statements and took time in order to carefully consider the offer.

The stake was not just shareholders' money, it was also (and mostly) the extremely important matter of shaking a delicate situation. With Yahoo's acquisition, in fact, the most likely prospect was the accentuation of a 'Google-Microsoft' bipolarism which let no room for a third option. Google itself, in a maneuver that sounded hypocrite to many, remarked how such an alliance would have deprived the 'net citizens' of a freedom that allegedly, has been present to this day.

After a two weeks period, the final answer: Yahoo boldly decided to refuse Microsoft's acquisition offer, citing a price that was allegedly too small for the big company potentials, and the fact the company desires to keep its economical independence to protect its shareholders all around the world. Which, according to sources close to Yahoo, could also mean the company is actually simply trying to raise the price. Would that be the case, the strategy proved unsuccessful, as there was no official statement on that side made by Microsoft.

Does this mean Yahoo will continue on its own and wants to keep existing as an independent company, or not? It likely does, but only highly ranked people in the company known the actual truth about this at this stage: who knows, now that the way has been opened and the minds in Yahoo tempted, we may even see an acquisition offer by another company in a few months, even if this perspective seems unlikely right now. Sadly, one thing that is certain is that Yahoo's negative trend in the last couple years is a bad symptom of a company that, if not 'ill' yet, is at the very least dangerously close to getting a bad cold, while Google seems to be getting healthier every day. Too bad the potential medicine was offered to Yahoo by a doctor with a second meaning.

Learn more about this author, Dario Borghino.
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