Microsoft, Yahoo talking again

Jake Widman
Friday, 10 April 2009 23:46

Business IT - Technology

Sources say that recently installed Yahoo CEO Carol Bartz and Microsoft CEO Steve Ballmer are discussing partnerships (but not acquisitions).
According to a report in All Things Digital, the discussions are "preliminary and wide-ranging," covering search and advertising relationships.

But sources on the Yahoo side scotched any idea that the talks represented a new attempt by Microsoft to acquire Yahoo, an effort that dominated tech news last spring but ultimately fizzled out in June 2008.

The end of that engagement set off a decline in Yahoo's stock price, which hit bottom last November when CEO Jerry Yang stepped down.

Investors will probably welcome any renewal of the relationship: Yahoo stock rose briefly last month when Ballmer publicly mentioned his interest in a search deal.

Carol Bartz came to Yahoo in January after a successful stint at Autodesk. The fact that she wasn't around for last year's sometimes-bitter negotiations is seen as a positive sign for any new discussions.

She also brings previous experience with Silicon Valley deal-making.

For its part, Microsoft has been pour significant efforts into relaunching and rebranding its own search product, so far called Kumo.

See page 2 for what the outlines of a new deal might involve.