Microsoft to Buy Yahoo!?

From the WSJ:

The offer, $31 a share in cash and stock, is a 62% premium to Thursday’s closing price. Microsoft said Yahoo holders would be able to trade their shares for cash or 0.9509 Microsoft shares a piece, with no more than half of the overall purchase price paid in cash.

Seems too good for Yahoo! shareholders to pass up. What would it mean for us?

It could have a big affect on bloggers and site owners. Currently Google dominates the pay per click advertising market with AdSense. Microsoft getting control of Yahoo’s advertising network could mean a higher payout for publishers and maybe even some transparency in just what percentage of the cost of an ad a site owner is paid for a click. Currently, there is no market force to compel Google to pay out higher rates or to disclose their payout percentages.

Microsoft can actually afford to operate a division at a loss for a while in order to change the market. For proof, look no further than Internet Explorer and the X-Box.

Of course, Google could always counter with an even better offer. It’s a good time to hold Yahoo! stock, huh?

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