Microsoft Says Yahoo Deal Was About Search

    June 20, 2008

Microsoft executives said the company does not plan to make a slew of Internet acquisitions since it ended its bid for Yahoo.

There has been speculation that Microsoft would possibly buy Facebook, which it has a small stake in or Time Warner’s AOL along with a number of other companies.

 "People don’t understand what they’re talking about," chief executive Steve Ballmer said in an interview with the Financial Times. "At the end of the day, this is about the ad platform. This is not about just any one of the applications."

Kevin Johnson, head of Microsoft’s Windows and Internet businesses, said that the bid for Yahoo was part of Microsoft’s strategy to strengthen its advertising business, with the focus on the search advertising market.

After Microsoft dropped its bid for Yahoo last month it returned with an offer for the search business.

"The most important application for the foreseeable future . . . is search," Ballmer said.

"I don’t think we can say, ‘OK, well, we’re going to be in the ad platform business and we’re going to do it just on the strength of non-search-based assets.’ We don’t have to dominate, but we’d better have a darn good chunk of the search market over time."