While Yahoo!'s board held talks on a range of options it had including Microsoft's bid, it is negotiating to join hands with AOL as an alternative, suggests Times Online.
In fact this is a second time that Yahoo! appears to be negotiating with AOL merger, the earlier talks failed owing to differences on prices. With Microsoft's "hostile" bid in its face and an impending economic downturn, Yahoo!'s is left to consider all the options it has. Tie-ups with Google and Disney are also possibilities being explored.
A merger between AOL and Yahoo! is quite plausible as it would enable Yahoo! To get a stronghold the mainstream advertising. Moreover, with AOL's clients becoming Yahoo!'s client as well, sounds positive for Yahoo!'s future. A possible outcome could be that AOL and Yahoo merge their media businesses and services with Google as the search/ad engine.
All said and done, the other angle to the story is that Google also has a 5 per cent stake in AOL, would this fact be an obstacle to such a merger to materialize remains to be seen?
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I believe Yahoo should merge with Microsoft as microsoft is a big giant in OS area and they are just left behind in the online area. Merging with Microsoft would hit google hard as they are the biggest SE and Ad-wrods giant.
Microfot has its adcenter and yahoo its SEM combination of them would create a completely new and fresh competiotion in SE world and hit google hard.
I always believe there should be no monopoly but always a competition as competition fosters better market in developing better products and provides more option.