Currently, Google is the largest and most lucrative advertising market online and internet search sites. In order to be able to compete with them, Microsoft, which was way behind Google were willing to buy Yahoo, the number 2 power in online advertisements. The two sides failed to agree on a price of the proposed acquisition which valued Yahoo at $47.5 billion. But after three months both sides are seeing that it will be difficult to try to compete with Google by themselves separately.
The CEO of Microsoft, sees the online advertising business is essential for their future because consumers and businesses increasingly are switching from desktop software to free online services that do the same things. Looking at Google’s market dominion right now, it is almost impossible for Microsoft to catch them. They are taking 77% of the revenues from little text ads on their sites, Microsoft after yeas trying is at 5% of US search revenue.
I think it will be really hard for Microsoft try to compete against Google which is almost monopolizing the market, and standing on the top by itself. I think they need to faster in the acquisition of Yahoo so that they can be able to compete against them. If it is a real necessity for the company, and both sides are seeing that they are not able to compete by themselves the process of acquisition should go faster. I think that when they join they are going to be able to compete more effectively.
20600642 Entry #9
