If I owned Microsoft and Yahoo! 

Microsoft is a little like the Sony of software. Both companies lean towards creating proprietary formats and using their sumo weight to attempt to control the industry. Google says Microsoft’s bid for Yahoo! is hostile. I say Microhoo! would not be as bad as MicroSony. The potential Microsoft buyout of Yahoo is an intentional and offensive move against Google. If I owned Microsoft and Yahoo, I would concentrate on two things:

  1. Don’t get caught up by Google
  2. Continue to apply pressure to Google by attacking Google’s weaknesses (yes they have a few).

Don’t get caught up by Google

There’s lots of internet real estate and opportunity left to capture. For example, there are not any real competitors in the cloud computing web services space. Amazon is dominating with their storage and computing clouds. It would be very difficult for a startup to compete with Amazon. Would you trust your data with a company that you don’t know will last its current round of funding? I know Yahoo is working on Amazon-like services because I got a call about it from a recruiter a few weeks ago. With Yahoo’s infrastructure combined with Microsoft’s resources, there’s potential to create some real competition in that space.

Concentrate on Google’s weaknesses

The “do everything” and “do no wrong” company has weaknesses? Absolutely. Two large examples are social networking and photo sharing. Google has weak offerings: Orkut and Picasa as compared to Facebook and Flickr. Flickr is owned by Yahoo. I would should trim some fat by getting rid of silly implementations like Live Spaces and soapbox. Why not integrate your successful products with other successful products in the industry? Why not become the biggest Facebook developer on the planet by creating a seamless experience between Hotmail, Flickr, and Facebook? Hitting Google’s soft spots will create loyalty and get Microsoft closer to those luscious advertising dollars.

Of course, if the deal falls through, these quick thoughts mean nothing. It was fun to think about though.