Yahoo Wants An Upgrade Of Microsoft Money

    February 6, 2008
    WebProNews Staff

Yahoo may be playing a dangerous game of Chicken with Microsoft, as one analyst hinted the company wants Microsoft to up its $44.6 billion bid.

The question of how much Microsoft wants Yahoo could be answered in the coming weeks. Though Microsoft’s first offer represented a 62 percent premium for Yahoo’s stock, Yahoo may push for an even richer payday.

Citigroup analyst Mark Mahaney has been showing up all over the place since news of the offer became public. The New York Post said Mahaney thinks Yang is angling for more money out of Steve Ballmer and company.

The analyst claimed a 40 percent likelihood that Microsoft will have to dig a little deeper into the sofa cushions and find some extra cash to seal the deal. Mahaney justified this by noting the dramatic leap in market share for online advertising Microsoft gains from a successful Yahoo bid.

Other scenarios could happen, like Yahoo outsourcing search advertising to Google, a scenario that may be playing out in Europe. Giving Google even more paid search revenue looks like a direct route to raising antitrust complaints from Microsoft, and investigations in Europe and the US into Google’s business.

Even if Google wants to help Yahoo, they may be limited in the help they can provide. Like a better deal from Microsoft, possible Google assistance should be known soon, if it is indeed forthcoming.