Microsoft has made a bid to buy Yahoo for, as Steve Ballmer says, "a 62% premium above the closing price of Yahoo! common stock of $19.18 on January 31, 2008," which puts the price tag at about US$44.6 billion.

About 8-9 years ago there was talk in the Internet community that maybe Microsoft would/should buy Yahoo, so in the scheme of "business years", less than a decade is not long to wait. In Internet years it's a lifetime though, and so much has happened since then — Altavista and Excite have come and gone while Google has risen.

It makes sense for MSFT to buy Yahoo. Yahoo has wasted its resources on trying to best Google and has forgotten its media roots. It should refocus on building a strong media brand and let the search sector continue to morph. That being said, Yahoo needs to re-invigorate its Finance channel (maybe it should have purchased Marketwatch or Dow Jones??) and also keep its eyes on CNet, which is also languishing at the moment and can probably be bought cheap. And after that it should continue to build itself into a media brand.

MSFT has tried to get into media on television and online, and with a Yahoo combo it can work on placing better content directly on the desktops of everyone not using Macs or Linux.