Steve Ballmer Starts Talking Yahoo Again

• At a media conference in New York today,  Microsoft Chief Executive Steve Ballmer said he expects to see fewer acquisitions in the next 9 months while the economy resettles, but he did say he would be open to discussing a search partnership with Yahoo’s new chief, Carol Bartz.
• Because valuations at this point in time are hard to assess, Ballmer said he  preferred a search deal with Yahoo, but no outright acquisition. Bartz, in my eyes, has always been put in place at Yahoo to get back the original deal Microsoft offered last year. With no personal attachment to the company and Jerry Yang almost out of the picture, a search deal by the end of the year, followed by a 2010 acquisition by Microsoft seems entirely feasible.
• Yahoo search market share has been declining for the past 24 months, so striking a deal soon would be in the best interest of Bartz, who is not exactly an expert in the field of turning around a search brand. From radio ads, to billboards, Yahoo can’t seem to find a break. What is in Yahoo’s corner is the fact that Microsoft’s search market share has been declining as well, making the no. 2 search company in the US an even more prime target for Microsoft who is desperate not to be left in the dust when it comes to the search game. Microsoft wants a search partnership with Yahoo in order to get bigger in the search business, but as we’ve seen with Google, being a big player in search can lead to the success of so many other cloud based products and revenue drivers.  I still have a hunch that Microsoft’s 2009 launch of Kumo.com, the rebranded LiveSearch, will have something to do with a Yahoo co-brand. At the end of the day, a search partnership can do nothing but help each of the compaies and provide another avevnue to sell advertisements. As with my 2009 predictions for the tech sector, a Yahoo-Microsoft partnership is a top 5 contender.

Tagged as: back on, deal, Microsoft, new york, press conference, steve ballmer, Yahoo