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Will Microsoft do a deal with Yahoo?

It has been widely assumed that a primary motivation behind Google's was to head off Microsoft at the pass. But the Windows empire, as we all know well, is not one to lay down its arms easily.

Microsoft Yahoo

So a new round of speculation has focused on Microsoft's next move, especially since one of its program managers coyly mentioned a private meeting with "another Tier 1 Internet company" that also has an interest in thwarting Google's ambitions. Theories immediately centered on , as the mystery company.

Given that Yahoo and Microsoft already have joined forces on instant messaging, an expansion of that partnership would not be ludicrous. And Microsoft has shown other signs that it is to keep Google from taking over the world. Bloggers have bandied about other possible partners, namely Amazon and eBay, but so far the smart money seems to be on Yahoo.

Blog community response:

"Microsoft Program Manager Ian McAllister wrote about an intriguing meeting he attended 'with some senior players at another Tier 1 internet company.' The other company's representatives offered to 'work together' with Microsoft, in order to prevent Google from dominating the Search and/or advertising business. Hmmm, I wonder who the "Tier 1" Internet company is? Yahoo?"
--Web 2.0 Explorer

"Yahoo and eBay are two companies that leap to mind, obviously. AOL is now in cahoots with Google, based on a $1B partnership. Who else might it be?"
--Stowe Boyd in Corante

"Speaking at Kelsey's ILM conference in early December, Microsoft Local Group head Erik Jorgensen noted that Microsoft isn't necessarily going to emerge as local's new nucleus. He basically acknowledged the fact that local is permanently fragmented, with several well entrenched players, including Yahoo, Google, AOL/MapQuest and IAC."
--The Local Onliner