Can Google Still Claim To Be David To Microsoft's Goliath? No.

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Yahoo! won't rush into Microsoft deal

Google finally went on the record today regarding the proposed Microsoft/Yahoo deal.

In short, they don’t like the idea of Microsoft and Yahoo being one company. They think it raises “troubling questions” and threatens “the underlying principles of the Internet: openness and innovation.” Microsoft is also vilified as engaging in “inappropriate and illegal influence” and having “legacy of serious legal and regulatory offenses.” They mention, among other things, the overwhelming market share in instant messaging and email, and the large number of page views their respective portals generate.

But 2008 may be the year Google can no longer hide behind the “David v. Goliath” defense with Microsoft. Google is the reason that Yahoo has stumbled so badly, and may be Microsoft’s last hope to be a meaningful player on the Internet over the long run. To put it bluntly, the roles are reversed. Google is now the Goliath, and they’re public whimpering on the acquisition makes them look petty and scared.

The fact is that this deal isn’t about email, IM or even page views. In the places that matter – search share and advertising dollars, Google is slaying everyone. 2007 Google search share: 64%. Percentage of all online ad dollars going to Google in 2007: 40% and growing.

The truth is that Google has become the new Microsoft, and if we want to avoid a repeat of history, we need to allow the formation of a real competitor to keep them honest. Otherwise, all the ills perpetrated on the world by Microsoft in the nineties will likely be repeated again, this time by Google.

When it comes to Google standing up to the FCC and the incumbent wireless carriers to make our life better, I’m behind them 100%. But when the complain about the formation of a new entity that can provide them real competition in the search and online advertising space, I’m not feeling the love.

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