Having spent north of $10 billion buying and building a Web business, Microsoft (MSFT) finally acknowledged its best efforts have done nothing to stall Internet leader Google (GOOG). On Feb. 1, the software giant took its most audacious step yet, announcing an unsolicited $44.6 billion bid for online rival Yahoo! (YHOO).
The deal would combine the second- and third-largest players in Web search. For Microsoft, it may be something of a Hail Mary pass, a last best attempt to catch Google while it still can. "We have been making good progress," says Microsoft CEO Steven Ballmer. "We're in this game, and we're going to be in this game. But the market leader is getting stronger."