Microsoft carry a huge amount of clout, their massive share of the desktop operating system market gives them a dominating advantage. This level of success has so far eluded them online with their search engine MSN Live delivering simply terrible results for users.

Microsoft’s latest attempts to grab a chunk of the internet have been focused in the form of an extremely aggressive takeover bid of Yahoo!. Yahoo’s price had been considered inflated by many analysts for some time at a market value of around $27 per share. Then Microsoft steamed in from the fog with the momentum of their awesome capital and offered $31 per share.

Microsofts Steve Balmer followed up the takeover attempt after 2 months of flip flopping from the Yahoo! board with a typically ‘charismatic Steve’ letter:

‘…If we have not concluded an agreement within the next three weeks, we will be compelled to take our case directly to your shareholders, including the initiation of a proxy contest to elect an alternative slate of directors for the Yahoo! board. The substantial premium reflected in our initial proposal anticipated a friendly transaction with you. If we are forced to take an offer directly to your shareholders, that action will have an undesirable impact on the value of your company from our perspective which will be reflected in the terms of our proposal…’

Basically giving Yahoo! three weeks to either sign up or go to war as Microsoft reaches for the support of the shareholders directly at a lower price than they previously offered.

Yahoo! in an attempt to rally some support from within the company and its shareholders and raise its perceived value responded by running trials of outsourcing its paid advertising to Google. However Google ads will only appear for 3% of searches in America and what financial benefit it offers Yahoo! is debatable, but that’s not the point.

Meanwhile Rupert Murdoch’s News Corporation the owner of Myspace, is in talks with Microsoft to create a joint venture for the takeover of Yahoo!. A deal that would change the landscape of the internet as the collision of Africa into Europe did the landscape of France.