
Microsoft's hostile bid for Yahoo has caused tensions with arch-nemesis Google to boil over, with the search giant warning the planned merger could threaten the openness of the internet.
The two technology titans have taken pot shots at each other over the years - the most extreme example of which was when Microsoft CEO Steve Ballmer allegedly vowed to "f---ing kill Google" - but Google has largely avoided returning fire publicly.
But all bets were off after Microsoft launched a $US44.6 billion ($50 billion) unsolicited bid for Yahoo, the world's most popular internet portal and one of Google's main competitors.
"Microsoft's hostile bid for Yahoo raises troubling questions," said David Drummond, senior vice-president of corporate development at Google and the search giant's chief legal officer.
"Could Microsoft now attempt to exert the same sort of inappropriate and illegal influence over the internet that it did with the PC?
"While the internet rewards competitive innovation, Microsoft has frequently sought to establish proprietary monopolies - and then leverage its dominance into new, adjacent markets."
In response, Microsoft general counsel Brad Smith said the takeover would in fact create a more competitive marketplace by establishing a "competitive No.2" to take on Google in online search and advertising.
It is unusual for Google to weigh into the matter so early - Yahoo has yet to respond to the bid - but some are interpreting the move as payback after Microsoft in April last year urged US and European regulators to consider scuttling Google's plan to buy DoubleClick, an online advertising company.
A marriage between Microsoft and Yahoo would allow the former to compete far more effectively against Google in the online advertising space, search and internet applications.
For Yahoo, the takeover could help the brand return to its former glory during the dotcom boom, before Google out-engineered it with a superior search offering.
As well, it would be difficult for Yahoo's board to turn down the unsolicited offer, which represents a 62 per cent premium over the struggling company's market value. Microsoft and Yahoo have discussed the possibility of an alliance in the past but Yahoo eventually rejected the advances.
It is understood that Google, which dominates the global online search and advertising industry with a market share of more than 60 per cent, would be prevented by US regulators from making a competing offer for Yahoo for anti-competitive reasons
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