It didn't take long for some new frontline action in the Microsoft/Google War. Today Google used its very much public blog to put in no uncertain terms that it is very much against Microsoft acquiring Yahoo and hopes "policymakers" aka, the government looks into it. You'll recall that Microsoft publically asked "policymakers" to look into Google purchase of DoubleClick last year - which they deemed as troubling.

And yet that Google/DoubleClick deal is a small fraction of this new Microsoft/Yahoo one (less than 10% actually). As Google correctly notes, Microsoft buying Yahoo equates to much more than them buying a company good at one thing (as was the DoubleClick case), but rather a huge company that through innovation has become a market leader in a number of areas, namely email, instant messaging, and their portal page - three areas which coincidentally (or maybe not so according to Google), Microsoft has also done well in by itself.

While the government held up the Google/DoubleClick deal for months, only recently allowing it to pass (after several moves by Microsoft such as buying aQuantive, and a stake in Facebook), and the European Union still not signing off on the deal (though word is spreading now that they could as soon as this month) - Google no doubt, at the very least wants Microsoft to get the same long, drawn out process in their Yahoo acquisition - and you can be almost certain that they will get that from the EU.

But most experts are in agreement that a deal eventually would go through (assuming Yahoo doesn't find another buyer) because while Google doesn't mention it in their post, two of the major factors in the Microsoft/Yahoo deal are Search and Advertising - two areas where Google will still have a commanding lead in even after you combine Microsoft and Yahoo.

Still, I'm glad Google publicly raised some of these issues, namely Microsoft's propensity for its own proprietary formats that has lead to both a crippling of both their operating system and the Internet Explorer web browser. With the Netscape browser set to be laid to rest permanently very soon, its important to remember just what Mircosoft did to kill what was the dominant web browser at the time. Google certainly hasn't forgotten.

My #2 prediction for 2008 was the following:

2) Microsoft and Google's next big battle will be over who gets the rights to purchase at least part of Yahoo
While many are still waiting for Yahoo to turn around, it seems to be increasingly questionable as to if they can. I don't think they'd want to sell completely but perhaps take an investment injection such as Apple did from Microsoft many years ago and Facebook did recently from Microsoft. If Google were to win this, look for Microsoft to push for more anti-trust hearings. If Microsoft wins, looks for Google to buy a half-dozen other companies Microsoft wants but won't sell to MS.

While it's unlikely that Google would ever be allowed to buy Yahoo (just think of how much control they would have over search and advertising then), it's clear they mean to fight a public war with Microsoft over their attempt to do so. I wonder if Google won't try to work on some cash-injection/investment plan in Yahoo (similar to what Apple accepted from Microsoft right when Steve Jobs came back to the company) to try and make it so that Yahoo won't have to be taken over by Microsoft. Or perhaps Google could try to funnel money to someone like News Corp. so they can put in a bid - News Corp. does seem open to someone buying into MySpace, and Google has a large ad-deal with MySpace...

If Microsoft/Yahoo does go down, look for Google to waste little time in buying some other company that Microsoft badly wants - or an even closer alliance with Apple. The war rages on.

As I wrote in December on the Microsoft/Google War:

And 2008 should be the most explosive year yet. Just wait until one of them tries to buy Yahoo.

Didn't take too long...

More thoughts:

• The Escalation of the Social Networking Proxy War
• Microsoft's New Recruit, Facebook, Closes In On A Proxy War to the Google/Microsoft War
• MySpace To Join Google's OpenSocial - An All-Out Social Networking War Has Begun
• Google: GPhone Going After Microsoft. Microsoft: Google Reads Your Email
• Microsoft Building Top-Secret Next-Gen Search Engine in Google's Backyard
• Microsoft Goes for the Bank, Google Goes for the Buzz?

[photo: flickr/squacco]