Image via CrunchBase, source unknown
Last time, I hinted that there was more than Google-phobia driving this attempted purchase, and there is. In addition to vaulting overnight to a relevant search power, there are a few other areas where a combined company would become a real market force.
Start with email. Even though GMail is growing quickly, Yahoo! still has a ton of email customers. Add those to Microsoft's Live email, and the combined market share of these two email platforms is on the order of 80%. That's a lot of captive desktop time where ads could be shown - if Microhoo can maintain that market share.
Then there's portal traffic. Yahoo's home page is a landing spot for a lot of users, and I have a hunch that these are users in the most stable demographics on the web. All of those eyes are a valuable asset, not just for selling ads, but to serve as a launching pad for new initiatives. Check out this article on readwriteweb where they talk about the impact of a recently-launched feature called "Buzzing Now". According to the article,
- Yahoo.com has sent approximately 16 million total referrals to just a subset of the publishers in the beta during the first two weeks via “Buzzing Now” links in the Featured section of the homepage.
- Salon.com reached over 1 million uniques in one day for the first time in the company's 12-year history, after Yahoo.com linked to one of their highly "buzzed" stories.
- US Magazine: Referral visits from the Yahoo! homepage accounted for 32% of total visits that day.


Detractors of the Microhoo deal believe that Yahoo's open culture is going to clash mightily with Microsoft's, but I think they're wrong. I've seen a big change in Microsoft over the last few months. There's a greater embrace of openness than they've ever shown, and it's taking root and flourishing. Microsoft is ready for Yahoo's sort of culture, and I really think there are parts of Yahoo! that could stand a little infusion of Ballmer's enthusiasm - maybe even a swift kick. This could be a pretty cool partnership.