Both Yahoo and Microsoft are building server farms on the Columbia River (and elsewhere) to try to keep up with Google in cloud computing. Just staying in this game requires cap investments at a minimum of $2 billion per year. Microsoft can afford it; Yahoo can’t.
And together? If this deal goes through, how these two companies will integrate their clouds is a big question, and a significant challenge. They’re different architectures and run on different software. This means that while Google races ahead, pouring billions into new server farms and sticking with its tried-and-true architecture, Microsoft will face a giant tech integration challenge.