Microsoft and Yahoo finally tied a knot, but not the knot that Yahoo shareholders have long yearned for. The new-economy giants inked a 10-year Web search deal in a bid to take on Google. Google shares barely budged but Yahoo’s sank more than 6 percent as the deal stopped short of combining display advertising businesses.
Back when this deal was all the rage, it was a story of egos. Then Yahoo CEO Jerry Yang was ultimately thrown out for not getting a deal done. Veteran agitator Carl Icahn was in top form, blasting Yahoo from the Street. Now under the new management of Carol Bartz, expectations were slowly rising that a broader deal might get done.
The question now is whether the market that had for so long hoped for a big deal will see this one as at least a step in the right direction.