Keith Watanabe * NET 2.0

Everyone seems to be looking at the pure financial aspects of the Yahoo-M$ buyout deal as well as the bad publicity that Yahoo has received in the past few years.  But I thought of a few other problems that would occur as a result of the Yahoo-M$ deal should it fall through:

• Lock down of engineers.  Remember the embittered battle between M$, Google and Kai-Fu Lee?  All engineers would face similar non-compete clauses upon the transition.  Obviously, Google would be a safe haven, but it's doubtful that they could fully employ all engineers initially.
• Lack of support for non-IE browsers.  Considering Yahoo's global reach, the impact of revoking support for non-IE browsers would be a tremendous blow to the internet market, especially browsers like Firefox, Safari and Opera.  Don't think they'll do it?  Just check out their new 3-D image technology which forces people to upgrade to Vista and the latest version just to view!  It's not a coincidence people.
• Absorption of numerous user accounts.  M$ has long wanted to create a standardized portal for user information management.  Remember the failure called Passport?  Getting Yahoo's tremendous registered user base would take them one step closer to that reality.
• Intellectual property absorption.  All that information that Yahoo has collected over the years and given away for free would be owned by M$ in nefarious manners.  While people criticize Yahoo for not monetizing their properties, it's almost a lock that the absorption of Yahoo into the M$ fold would imply that slowly they'd determine a method to get a return on investment for each Yahoo property.  In other words, all that hard work you've done uploading photos, creating social networks, etc. would more than likely be charged in the future.  The only reason for the moment while M$ gives away things for free is that they don't have the reach that collectively all these competitors have.  But grabbing Yahoo brings them closer and quicker to that goal.
  
• Absorption of all the partnerships that Yahoo has.  I think one of the internet's strengths, especially companies like Yahoo, is that it provides smaller players the chance to succeed by utilizing these services.  Moving Yahoo into M$ means that M$ can now control these services and do whatever they want like increasing fees.  In the case of APIs where other sites might employ the various web services provided by Yahoo, M$ would be able to shut them out or force them to sign new contracts and monetize those services (not a bad idea in reality, but M$ is not the player I'd want to be handling this)

A skunk is still a skunk.  I think people are only looking at the dollar signs and failures of Yahoo recently rather than examining the big picture.  M$ will continue to play a zero sum game when it comes to business for as long as they exist.  And here it will not be any different.