The Yahoo acquisition is still very much a possibility for many reasons. (Not to mention, Yahoo now has a new CFO with deep ties in the banking industry).Yahoo is still the #2 player in the search space. With Panama, Yahoo has managed to ape Google’s Adwords to a great extent. Further, Yahoo still has a huge market of advertisers, second only to Google. If you disregard the overlap between Microsoft and Yahoo services, and look at only the search and advertising market, a Yahoo Microsoft marriage still seems a distinct possibility with plenty of synergy despite the aQuantive acquisition.
With a $6B acquisition, Microsoft is significantly beefing up its online ad strategy. Although the rumors of the Yahoo acquisition having died down, the aQuantive acquisition just confirms the fact that Microsoft is looking very actively at various strategies to counter Google’s huge lead in the advertising space, before its too late. With Yahoo’s acquisition of Right Media and Google’s acquisition of Double Click, the online ad space is prime for some serious competition among the big 3 and the fast fading AOL.