This was the week that Yahoo said no to $31 a share offer by Microsoft.
It was also the week that Yahoo raised the possibility of seeking a marketing deal with News Corp, or a deal with AOL.
It is expected that Microsoft will increase its offer to $35 a share in the next week or two or launch a hostile takeover bid which would involve unseating most or all of the Yahoo Board of directors
Other issues that arose this week concerning the merger, is over the amount of control the combined company would have over all internet e-mail’s
Almost 75%t of U.S. Internet users have either a Windows Live Hotmail or Yahoo email account.
About 46% of the more than 200 million Internet users in the United States have Web-based email accounts run by Yahoo, while 27% use Microsoft’s Live Hotmail and 29% use Google’s Gmail, according to International Data Corp.
A merger of Microsoft and Yahoo could put Microsoft in a position that they would actually control a huge percentage of all e-mail communication.
The situation is just one of the factors that US and EU regulators will have to look at before approving the merger.
The merged company would also have an overwhelming share of instant messaging accounts.
Having control over such a large number of e-mail accounts and instant messaging accounts would give Microsoft broader access to personal information that could give it an advantage in targeted advertising.
There is a lot of concern how the information gathered from e-mail use will be used and secured.
A subcommittee of the U.S. Congressional on Energy and Commerce, announced plans to hold hearings on consumer-privacy issues related to the proposed merger.
