The potential merger of Microsoft and Yahoo will put the two companies' Web apps in internal conflict. In some cases, a Microsoft app might replace a Yahoo app. But in more cases, products from Yahoo, a company built for the online platform, will be the ones to survive. Here are likely outcomes from what would surely become a multiyear internal struggle.
Portal pages like My Yahoo and MSN.com, and their personal page counterparts My Yahoo and My MSN, act as big advertisements to whatever products and media the company wants to push on a given day. Yahoo and MSN will likely keep their distinct brands for a good long time while the underlying platforms and user bases are merged. On the surface, the products themselves are more alike than different. But online content and indexing is Yahoo's main business; it will pick up this battle. Winner: Yahoo.
Yahoo, founded on Internet search, has three times the search market share of Microsoft. Microsoft will kill its good-money-after-bad Web search project and move its users over to Yahoo. Winner: Yahoo.
I give the nod to the killer development team over at Yahoo, which came over in the OddPost acquisition. While most of those people are now on other Yahoo projects, the OddPost platform is slick and innovative. Microsoft could slowly move its users over. Winner: Yahoo.
Microsoft has the pretty bird's eye view and a 3D map viewer plug-in (which is cool but slow on many machines). But Yahoo has a better fundamental mapping product that allows click-and-drag rerouting. Google Maps is still more useful than both. Winner: a merger, hopefully, of Microsoft's features with Yahoo's nicer UI.
Even though I think Flickr is too weird for the real world and that Yahoo should not have killed its straightforward and smooth Yahoo Photos, Microsoft buries its photo site in its blogging platform, Live Spaces. It's a nice tool but the content and the users have hewn to Flickr, due to its community-forward features like group tags and its open API. Winner: Yahoo.
Please. These sites are experiments. Wallop isn't even inside the Microsoft walls; it's a spin-out. The time for this kind of messing around is over. The merged company should buy Facebook during the inevitable upcoming valuation backlash. Winner: Neither.
These two IM networks already allow users to communicate across them, which speaks well of both companies. A merger of user accounts is the next step. Yahoo has a more flexible collection of interfaces to its platform, thanks to its integration into Yahoo Mail. Both Yahoo and Microsoft have Web clients. Winner: Yahoo.
These are both really clever products, but with limited audiences. My anecdotal observation says that more people are using Pipes to build experimental Web apps. Winner, Yahoo, not that it matters all that much.
Microsoft was ahead of Yahoo in trying to create a universal Web log-in scheme, called Passport. The updated version is called Live ID, but no major non-Microsoft products use it. Yahoo recently pledged support for the OpenID standard, which is gradually becoming a standard for Web 2.0 authentication. Winner: Yahoo.
Neither company has a credible all-online productivity strategy. Yahoo is not in the space, and Microsoft is still pursuing hybrid apps: It's Office Live Workspace service uses the Web for access to documents that are edited in Microsoft Office. Microsoft will begin to release crippled online versions of its productivity apps eventually, and must follow with an online version of Office before Google takes over in this market. Winner: Microsoft.
These two ad networks, combined, are a more credible threat to Google than they are separately. However, Google's lobbyists will ensure there's argument that the combined network is just too big. Winner: the DOJ.
Upshot: Microsoft is buying its way in to the Web 2.0 and Yahoo's online products are, for the most part, the ones that will survive. However, there are still holes in the combined company's Web 2.0 product set.
I realize that I have left out several categories. I will try to add them in later.