Bill Gates gave a wonderful speech at the World Economic Forum in Davos about the need for “creative capitalism” or social entrepreneurialism but with the news of Microsoft bidding for Yahoo, the one thing missing in the deal is creativity or entrepreneurship. This is a merger of old, closed technologies that will probably fail in the competition with Google’s new, open and more agile technologies. It has the feel of that old Time Warner merger with AOL.
Microsoft has spent billions trying—and failing—to morph out of its solid position of monopolist of fixed PC screens into a flexible Web 2.0 player in an open source context. Yahoo was once a great media company that used great content to deliver big audiences to advertisers by being a portal. And yes, it does search too.