The Wall Street Journal this morning is reporting that Microsoft has bid $44.6 billion for the struggling perpetual second place Yahoo! web search engine. Interestingly, Terry Semel also resigned as Chairman of the Board yesterday. Let the new company name game begin. MicroHoo!, Mahoo, Yacrosoft…

There’s a conference call at 8:30 a.m. EST Friday 2/1/2008. The replay can be accessed by dialing (800) 642-1687 or (706) 645-9291; the conference ID number is 33470390. Keep reading for more thoughts – and add your own.

Talk about a shotgun wedding.

Given the publicity surrounding Vista’s tepid adoption, the growing competition from online office software suites, and their poor showing at just about anything they’ve tried online – it’s not surprising that Microsoft is looking to scoop up Yahoo! Apparently these rumors have been swirling for the last couple of years.

Why not pick up Yahoo! while they’re down on their luck?

By purchasing Yahoo!, Microsoft also gets access to the significant search (and advertising) traffic, online properties, online advertising and other things that they seem to have so much trouble generating themselves.

It’s been puzzling to watch the lack of a successor to Terry Semel. Although co-founder Jerry Yang has been described as a “Nice Guy”, those words are not the typical criteria used for selecting CEOs who lead Billion Dollar media companies.

My guess is that Yahoo! negotiates up this price and sells out – to either Microsoft or another suitor.

P.S. - It has to cause mighty Google some concern to see this type of activity the same week they announce what has been touted as some as an earning’s disappointment. You can’t help but wonder with this potential merger whether the teflon could fade soon from Google.

I just wonder when the anti-trust hearings will start? Wouldn’t it be ironic if this merger was approved before the Sirius – XM Radio talks (which have been stalled before the Government for the last year).

P.P.S. – Here’s a copy of the letter that Microsoft sent Yahoo! – courtesy of Silicon Alley Insider.

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