Why Microsoft woos Yahoo so much; what went wrong with the $44.6 billion deal to buy Yahoo!, following years of aggressive efforts to talk the company into selling out through private negotiations and on top of all, how much the tech industry could benefit out of Yahoo! Microsoft merger are issues that need some clarification.

To begin with, let us explore why Microsoft wants Yahoo’s company so much. “Microsoft’s interest in Yahoo! is all about growing in online stature to rival Google, while benefitting from shared costs and operational efficiencies”, remarked Steve Ballmer, Microsoft CEO in a recent interview. “While online advertising growth continues,” Ballmer remarked, “there are significant benefits of scale in advertising platform economics, in capital costs for search index build-out, and in research and development, making this a time of industry consolidation and convergence.” Ballmer made no bones about noting that “synergies related to scale economics” would help the combined companies to compete in a market where “there is only one competitor at scale,” clearly pointing a finger at Google.

Leveraging Microsoft’s strategy of innovation, which inter alia, means all about tying Windows as well as its other proprietary technologies to Yahoo’s online properties and services, Ballmer also commented that “Expanded R&D capacity would surely unleash new levels of innovation”. Stressing on the benefits of a probable merger, the Microsoft CEO also noted “operational efficiencies” would mean “eliminating redundant infrastructure and duplicative operational costs”. Although that would mean plenty of pink slips for MSN and thorough rebranding of Yahoo’s technology right under Microsoft label. It would also mean massive layoffs of Yahoo employees and a Hotmail-type transition of Yahoo’s systems to a Windows-powered underpinning.

Microsoft Maneuvers Often Seem Misguided

Microsoft’s idea of converting Yahoo’s services into “innovative” types by way of running them on its own platform (and tied to Windows) may sound like trying to run a Ford Thunderbird with a Volkswagen Beatle engine. As a matter of fact, it would have been much simpler and cost effective too to do it from the scratch. There is practically no reason behind  Microsoft’s paying heavily for Yahoo’s existing online businesses that are mostly built upon Free BSD, only to bury them later or spending enormously and converting things to run on Microsoft’s platform.  No wonder, Microsoft’s endeavors in merger with Yahoo or outright sale of the search engine gargoyle had failed time and again in the past for such misdemeanors

But this nagging strait is nothing new with Microsoft. Take the case of MSN as a clear cut example.  The first MSN was an AOL clone, developed in 1995, just to see the emerging open web crumble the interest in proprietary online services. But lo and behold – immediately thereafter, Microsoft promptly purchased Internet Explorer in an effort to develop a new Internet strategy and then tying it into Windows in a vain attempt to prevent alternative open development platform from rising on the Internet horizon.

Worst Part of the Whole Story

To be honest about it, the users probably hasn’t lost much on account of the Google – Microsoft debacle since both them are extremely self-centered and so a legal union would have created more hazard for the users than help. For instance, both of them are notoriously known for thrusting “Updates” on users on any pretext or plea, no matter whether these prove helpful or not. The experience is best illustrated by the comment on this issue expressed by an user who said “Life is hard enough without having to go back to school every time Google and Microsoft decide it’s time for an UPGRADE!