Yahoo! CEO: Microsoft Deal Not Necessary, Not Wanted

Yahoo! CEO Carol Bartz said this week that her company might be better off without serial suitor Microsoft, noting that the future would be "simpler" without any deal. She also said that some aspects of a potential Microsoft deal could draw antitrust scrutiny.

"Yahoo! doesn't have to do anything with Microsoft about anything," Bartz said this week. "Yahoo! actually has a bright, bright future, probably cleaner and simpler future without ... any Microsoft connection. We'd be better off if we'd never heard the word Microsoft."

In Bartz's view, news of a potential deal with Microsoft is overshadowing the fact that Yahoo! is doing just fine and doesn't need to combine forces with the software giant to compete effectively in search. Besides, she says, search is just one aspect of Yahoo!'s business.

Currently, online market leader Google controls about 60 percent of all web searches, compared with 20 percent for Yahoo! and about 8 percent for Microsoft. But that 20 percent, while a minority position, is not insignificant, according to Bartz. "Our 20 percent share is statistically relevant," she said. "What's really necessary is that we continue to grow our audience."

Bartz also hinted at a tantalizing proposition: While she says that Yahoo! could save $500–$700 million a year by farming out search to Microsoft, she believes it would actually make more sense for Microsoft to sell its Internet properties to Yahoo! instead. She said she has asked Microsoft CEO Steve Ballmer about this possibility. But the problem is an age-old one for the software giant: The combination of the two companies' dominant web, email, and instant messaging solutions would likely raise antitrust concerns.

Microsoft, this week relaunched a new version of its Internet search engine under the brand Bing. But Bartz said Bing isn't as cool as some claim. "\[Bing\] is interesting, but not over-the-top interesting," she said

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