Ballmer: Yahoo-Microsoft Deal Is Dead

By Chloe Albanesius  |  Posted 2008-07-24

Any Yahoo acquisition plans Microsoft might have entertained are now dead, said Steve Ballmer, Microsoft's CEO.

A Yahoo merger would have helped Microsoft's bid to overtake Google in search, Ballmer said, but with the $40 billion bill for Yahoo now off the books, Microsoft is moving on and looking to invest more in search, a business he categorized as a "two-horse race" between Microsoft and Google.

"Yahoo for us was always a tactic, not a strategy," Ballmer said during the company's annual financial analyst meeting July 17.

When Microsoft talks about "the need to change our position revenue per search curve, Yahoo is a tactic to accelerate that," he said. Yahoo and Microsoft also would have "had R&D and capital expense synergies by coming together."

At this point, however, "there's nothing under discussion between the two of us," Ballmer said. "It didn't work out; we're done."

In the future, Microsoft hopes that its place will be in search, he said.

Click here to read more on PC Magazine.

Rocket Fuel