Microsoft v. Yahoo: This Isn't Even Funny Any More

I don’t know if the tank in the image is supposed to be Microsoft or Google. But it’s clear who the guy is. And it’s clear what happens next. The tank wins.

Yahoo is so out-gunned in its fight to simply stay independent that it isn’t even funny anymore. Microsoft’s serious attempts to take over the company are over, even though Yahoo shareholders have begun to prostrate themselves in grief. Oh, if only they could go back and take that $31 offer.

Now Microsoft just appears to be toying with Yahoo as the they try to finalize a search outsourcing deal with Google. They’ve thrown their own name is a possible partner in the search business via a public announcement today as well as a strategically leaked internal memo (both are here). Yahoo, as always, fires back reactively and impotently. Their message boils down to “Jesus Christ, people, please stop suing us. I swear to God, we’re trying our best.”

So what happens next? Literally anything. Microsoft could partner with Yahoo on a search deal. Or Yahoo may do something with Google instead and fight it on the regulatory front. Or the whole acquisition may come back on the table.

But whatever happens, it’s clear that Microsoft is very much in the drivers seat, and Yahoo’s head is spinning. I can’t imagine this can go on for much longer. And frankly, Yahoo’s stockholders and employees deserve some kind of mercy killing at this point.

The big news this week may actually be Microsoft’s upcoming announcement at Advance08. In Kevin Johnson’s email today, he hinted at what might be announced:

On Wednesday, we will be announcing a major new initiative that our search teams have been driving. We are getting better and better with our core algorithmic search, and at the same time, we are investing to differentiate in vertical experiences and to disrupt the current model. You’ll hear more about our plans Wednesday.

I’ll be at the event and live blogging, so stay tuned.