The offer, contained in a letter to Yahoo’s board, is 62% above Yahoo’s closing share price on Thursday.

Yahoo cut its revenue forecasts earlier this week and said it would have to spend an additional $300m this year trying to revive the company.

It has been struggling in recent years to compete with Google, which has also been a competitor to Microsoft.

“We have great respect for Yahoo, and together we can offer an increasingly exciting set of solutions for consumers, publishers and advertisers while becoming better positioned to compete in the online services market,” Microsoft chief executive Steve Ballmer said.

Chairman quit
There has not yet been any comment from Yahoo.

Its chief executive, Jerry Yang, announced on Tuesday that he intended to lay off 1,000 staff as part of a restructuring plan.

Terry Semel, who stepped down as chief executive last June, also quit as non-executive chairman on Thursday.

Microsoft said that Yahoo shareholders could choose to receive either cash or shares.

Yahoo shares have fallen 46% since reaching a year-high of $34.08 in October. They rose 54% in pre-market trading.

“Ultimately this corporate marriage was forced by the rise of Google, which has grown into a serious competitor for both Microsoft as a software company and Yahoo as an internet portal,” said Tim Weber, business editor of the BBC News website.

“It is a shotgun marriage, but the person holding the shotgun is Google.”

‘Exorbitant premium’
According to its letter to Yahoo, Microsoft attempted to enter talks about a deal a year ago, but was rebuffed because Yahoo was confident about the “potential upside” presented by the reorganisation and operational activities that were being put in place at the time.

“A year has gone by, and the competitive situation has not improved,” Microsoft’s letter said.

But there has been some concern about the price that Microsoft is offering.

“To me, the premium seems exorbitant, for what is a dwindling business,” said Tim Smalls from the brokerage firm Execution LLC.

“I personally don’t see how the synergies of Microsoft-Yahoo is going to take on Google.”

Other analysts were more enthusiastic about the offer.

“It is a fantastic offer. It is game on,” said Colin Gillis from Canaccord Adams.

“This consolidates the marketplace down to Google versus Microsoft. These two companies will be going head to head.”

Original URL: http://news.bbc.co.uk/1/hi/business/7222114.stm

A source familiar with the matter said the purchase price was about $340 million. AOL, a unit of Time Warner Inc, did not disclose financial terms.

The deal, which adds 100 employees, marks the last big acquisition AOL plans as part of a restructuring to transform itself into a one-stop online advertising shop, AOL Chief Executive Randy Falco told Reuters in an interview.

“I expect it to begin to add to growth in 2008,” he said, referring to AOL’s online advertising growth, which is a big concern among investors. Ad growth slipped to 16 percent in the second quarter and 13 percent in the third quarter, from 40 percent levels earlier.

Quigo, which signed a deal with Time Inc in June and has more than 500 publisher relationships, is an Internet ad-targeting company that lets advertisers buy sponsored listings, much like Google’s AdSense, based on keywords or subjects.

Advertisers have little say on where Google places their ads, but Quigo’s AdSonar product lets advertisers place their ads on specific Web pages, including pages featuring topics or keywords such as “mutual funds” or “health and science.”

The Quigo system also lets publishers control their relationship with advertisers, rather than surrender control to a middleman like Google.

Quigo gives AOL “access to a ton of relationships with a ton of premium publishers, thousands of advertisers and unique technologies,” Quigo CEO Michael Yavonditte told Reuters. Quigo has deals with TheStreet.com, News Corp’s FoxNews.com, and Walt Disney Co’s ESPN.com, among others.

SPIN-OFF?
The deal will add to Time Warner’s growing roster of online ad technology firms.

AOL restructured its advertising business in September, consolidating into one division ad network Advertising.com; Tacoda, which targets users based on their habits; wireless ad network Third Screen Media; video ads company Lightningcast; and ADTECH, a global ad-serving company.

Some investors have called on Time Warner to spin off all or part of AOL, with expectations growing after Jeffrey Bewkes was named earlier this week to succeed Time Warner Chief Executive Richard Parsons on January 1.

Asked what he thought Time Warner’s view on AOL was, Falco said, “They just showed how they feel about our potential by supporting another big acquisition for us.”

The success of AOL is seen as critical to Time Warner’s sluggish stock price. The stock rose 1 percent to $18.54 following its third-quarter earnings report on Wednesday, which largely met Wall Street expectations.

“AOL is picking up leading technologies — the premier names and smart people,” said Stan Sandberg, principal at boutique investment bank Gridley & Co LLC, which specializes in interactive marketing and digital media. Sandberg spoke on Tuesday ahead of the announcement on Quigo.

Sandberg added, “Now that it will be consolidated under Platform A, they really are positioned beautifully to being the leading advertising technology company.”

The deal for Quigo comes amid a buying frenzy in the interactive advertising market and follows Google’s $3.1 billion pact to buy DoubleClick and Microsoft Corp’s $6 billion agreement to buy aQuantive Inc.

Original URL: http://news.yahoo.com/s/nm/20071107/wr_nm/quigo_timewarner_dc

And what is McAfee looking to get for its money? For starters, it’ll snap up ScanAlert’s Hacker Safe Web site security certification service, bolster its own SiteAdvisor security-rating system, and become the keeper of ScanAlert’s proverbial “good housekeeping” seal for sites seeking to reassure customers that they are conducting safe online transactions.

The acquisition, expected to close in the first quarter, calls for integrating ScanAlert’s e-commerce security certification service into McAfee’s SiteAdvisor system. McAfee last year acquired SiteAdvisor, which informs users about the safety of their returned search results, estimating the likelihood that a site could potentially infect their computer with spyware, spam, or a browser attack.

ScanAlert issues a Hacker Safe certification to Web sites that have undergone its scanning service for vulnerabilities, as well as demonstrating that they have been fixed. The sites also need to undergo daily scans by ScanAlert, in order to maintain their Hacker Safe stamp of approval.

The Hacker Safe certification will be visible through SiteAdvisor, once the acquisition is completed, and the technologies are integrated.

Security fears have resulted in consumers delaying their online-shopping decisions and transactions by more than half a day, according to ScanAlert’s own research.

Those concerns are nothing new. Two years ago, a fourth of online shoppers reduced their purchases, as fear over identity theft soared, according to a report by RSA Security.

E-commerce site operators, as a result, have been particularly interested in trying various techniques to boost the security of their sites.

As part of the McAfee deal, ScanAlert may see its overall acquisition price jump by another $24 million, should it hit certain performance targets.

The company has 8,000 customers, who represent more than 75,000 Web sites. Those customers include Toshiba, Warner Bros., and the American Red Cross.

Original URL: http://www.news.com/8301-10784_3-9807344-7.html

The move could give maturing Microsoft more access to young users and let Facebook get closer to a major software maker at a time when its growth is increasingly tied to a proliferation of small applications from independent developers on its site.

Citing people familiar with the matter, the Journal said the world’s largest software company sought to buy a stake of up to 5 percent in Facebook for $300 million to $500 million.

Facebook, led by its 23-year-old founder and Chief Executive Mark Zuckerberg, may insist on a valuation as high as $15 billion and is considering raising up to $500 million in cash to expand its operations, according to the Journal.

Such a deal could help Microsoft better compete against Web search leader Google Inc for a growing base of online advertising and put one of the Internet’s hottest names in Microsoft’s camp.

Facebook, which already has an advertising deal with Microsoft, would benefit from closer ties with developers as it seeks to turn its site into a full-fledged Web platform where users can play games, interact and read news about each other, said Forrester analyst Charlene Li.

“If you are building a business around building a platform there is one company that has done it better than anybody else — and that is Microsoft,” she said. “People have been just assuming that Google would be the best partner and that is not necessarily the case.”

Google has also expressed an interest in investing in Facebook, the Journal report said.

“It would probably be pretty good for Microsoft since it has not had the best success in creating really hip, young-people-grabbing stuff on the Web,” said Kim Caughey, a senior analyst at Fort Pitt Capital Group, which oversees more than $1 billion, including Microsoft shares, for clients.

Representatives for Microsoft and Facebook declined to comment.

Zuckerberg has repeatedly said his company wants to remain independent and is seen as preparing to float itself on the stock market eventually.

Facebook has grown to 39 million members, up nearly 63 percent from 24 million in late May, and is quickly gaining ground on larger rival MySpace, which was taken over by News Corp in 2005 for what is now seen as a bargain price of $580 million. MySpace has more than 200 million users.

Facebook’s explosion popularity has also drawn increased scrutiny, including a 50-state investigation into the company by attorneys general concerned about Web sexual predators.

New York Attorney General Andrew Cuomo said on Monday his office had subpoenaed Facebook and accused it of not keeping young users safe. Facebook said it was preparing a statement about the issue.

Redmond, Washington-based Microsoft already has an exclusive agreement until 2011 to broker display advertisements for Facebook. The Journal said Microsoft and Facebook are discussing expanding that agreement beyond the United States.

After relinquishing an early advantage in the lucrative paid search market to Google and Yahoo Inc, Microsoft is trying to catch up by clinching deals to broker display advertising to some of the leading names in “Web 2.0.”

Yahoo and Google are also maneuvering. Earlier this year, for instance, News Corp chief Rupert Murdoch said he had discussed swapping MySpace for a 25 percent stake in Yahoo.

Web 2.0 is a catch-phrase for a new generation of Internet services that run on interactive software and typically rely on content generated by users to attract more visitors. Microsoft also has an agreement with popular news site Digg.com.

Microsoft shares rose 1.5 percent to $29.08 on Nasdaq.

Original URL: http://news.yahoo.com/s/nm/20070924/wr_nm/microsoft_facebook_dc

Payments could double to as much as $700 million if profits grow, Disney Chief Financial Officer Thomas O. Staggs said.

The acquisition by Disney gives Club Penguin more resources with which to grow. According to comScore Media Metrix, the site nearly tripled in usage over the past year to 4.7 million unique U.S. visitors in June. Executives hope to expand to additional markets abroad and gain even more customers through promotions on Disney-branded sites.

“We have been actively searching for an organization that not only shares our values and concerns for children, but also has the ability and desire to help us bring Club Penguin to more children throughout the world,” said Club Penguin co-founder Lane Merrifield said in a statement. “We’ve found that partner in Disney.”

Club Penguin, from Canada’s New Horizon Interactive Ltd., offers a mix of games and chatting tools targeting the kids ages 6-14, who appear onscreen as plump cartoon penguins.

Kids win gold coins by playing games such as sled racing and, with a paid membership costing about $5 a month, buy virtual items like clothing for their penguins and furniture for their online persona’s igloos. Kids can attend parties and make friends by adding other penguins to their buddy lists.

Although sites like Club Penguin and its rival, Webkinz, are forcing parents to grapple with how young kids should be roaming about and chatting with friends online, many Internet safety experts believe these social-networking precursors are far safer than News Corp.’s MySpace, Facebook and other hangouts for older users.

Parents, for instance, can choose an “ultimate safe” mode, meaning chat messages sent and received are limited to prewritten phrases, such as “How are you today?”

In the standard mode, kids can type messages freely, but filters look for foul language and even innocent-sounding words such as “mom” — to prevent someone from asking, “Is your mom home?”

“Club Penguin embodies principles that are of the utmost importance to Disney — providing high-quality family entertainment and fostering parental trust,” Bob Iger, Disney’s president and chief executive, said in a statement. “The founders have woven together new technologies and creativity to build an incredibly compelling, immersive entertainment experience for kids and families.”

Other than renaming the service “Disney’s Club Penguin,” Disney said it has no immediate plans to change Club Penguin’s operations, which will continue to run from Kelowna, Canada.

“Club Penguin is going to continue to exist as is,” Iger said during the company’s conference call to report quarterly earnings. “The experience will not change at all. We don’t intend to get in the way of that or do anything that would in any way have a negative impact on their business.”

Iger said Disney planned to integrate Club Penguin into other Disney businesses, promoting it on the Disney.com site and the Disney Channel, Radio Disney and the company’s theme parks.

Disney already operates the virtual game “Toontown” and is developing a similar virtual world around its “Pirates of the Caribbean” characters. Iger hinted that Disney also was working on a virtual world based on “Cars,” an animated movie created by Disney-owned Pixar.

Iger said the acquisition of Club Penguin would give Disney the expertise to grow those properties more quickly.

Club Penguin says it has more than 700,000 paying subscribers and 12 million registered users, mostly in the United States and Canada.

Original URL: http://news.yahoo.com/s/ap/20070802/ap_on_hi_te/disney_club_penguin

Parakey was started by Firefox’s two founders, Blake Ross and Joe Hewitt. The site gives this description of the service: “Computers are frustrating. Creating documents, finding files, sharing information–why do everyday things still seem so tedious and counterintuitive? We hope that Parakey will make your life easier.”

According to Inside Facebook, “Parakey is intended to be a platform for tools that can manipulate just about anything on your hard drive: e-mail, photos, videos, recipes, calendars.”

What is Facebook planning on doing with a start-up that specializes in integrating online services with local machines? Facebook’s press release says the company will be working on the development of its Facebook Platform as well as its Web site.

I would have to say that Parakey will be bringing something fresh to Facebook Platform; otherwise, there would have been no need for this acquisition. Facebook’s developers could have continued to work on it. Tight integration with local content on your computer and offline access to some Facebook services seem likely here.

There are a few things that come to mind when I think about this. The obvious one is, of course, integration between Facebook Events and desktop calendar applications such as iCal and Outlook. A couple of the other things in the list of what Parakey can manipulate (photos and videos) match up with what Facebook is doing right now as well. Although these are good possibilities of what Facebook may do with this acquisition, it’s really anyone’s guess at this point, especially since nobody has yet really seen Parakey in action.

Details of the money exchanged in the acquisition have not yet surfaced. As more information about how Facebook will be using Parakey’s developers and technologies becomes apparent, I’ll do a follow-up on this. This news begs the question of what the odds are that Facebook is going down the road to an IPO.

Original URL: http://news.com.com/8301-10784_3-9747605-7.html

Terms of the deal were not disclosed, although the figure of $100 million had been reported by TechCrunch, which broke the story last week.

“This is an area where we saw a lot of opportunity and that was growing quickly,” Susan Wojcicki, vice president of product management at Google, said in a conference call with reporters.

Google is the titan of paid search advertising and has a large network of Web sites that host ads Google sells through its AdWords online marketing system. The company has been expanding aggressively into enabling offline forms of advertising, such as in print and on radio and television. Now it can put ads in the more than 430,000 RSS (Really Simple Syndication) feeds that FeedBurner has and it can expand its AdSense Web site publisher network with the FeedBurner publishers, Wojcicki said.

“If you are a Google advertiser, now you can advertise on feeds that you otherwise may not have had access to,” she said. Also, “our advertisers will have more access to (FeedBurner) publishers.”

Google will figure out “interesting ways” it can integrate FeedBurner technology with its Google Reader, Wojcicki said.

RSS feeds enable media Web sites, bloggers and podcasters to shoot their content directly to readers through so-called RSS readers. FeedBurner helps publishers deliver the RSS feeds, as well as manage the feeds, track usage of the subscribers and serve ads.

The Google deal will undoubtedly shine the spotlight on technology that while growing rapidly, is not yet mainstream.

“We can absolutely help raise the profile of this new distribution vehicle,” said Dick Costolo, chief executive and co-founder of 4-year-old FeedBurner, which is based in Chicago.

Google’s FeedBurner acquisition may just be the tipping point that leads to widespread adoption of RSS and advertising in RSS feeds, said Bill Flitter, founder and vice president of marketing at Pheedo, a FeedBurner rival that feeds ads in RSS feeds.

“There is a market for RSS and RSS analytics in advertising,” he said. “Looking at ads in the feeds, as content moves outside of your site, you need some sort of revenue model. Google has Google Analytics, which makes a good fit with FeedBurner’s analytics.”

The FeedBurner acquisition is just the latest of several recent Google purchases. On Tuesday, it was revealed that Google acquired security software developer GreenBorder Technologies. On Wednesday, it was disclosed that Google has purchased Spanish geo-photo firm Panoramio. In April, Google said it planned to spend $3.1 billion to buy Web ad firm DoubleClick.

Original URL: http://news.com.com/2100-1030_3-6188275.html

Microsoft offered $66.50 per share for the company for an 85 percent premium over aQuantive’s Thursday close of $35.87. The price highlights Microsoft’s willingness to open its wallet further in order to catch Google, Yahoo and AOL in the ultra-competitive market for posting ads on Web sites.

aQuantive has boasted significant growth in the decade since its inception, evolving to become the “parent company of one of the industry’s most successful families of digital marketing service and technology companies,” Microsoft said in a statement.

AQuantive includes three main brands: Atlas, which makes the Media Console advertising platform; DRIVEpm, which provides ad services that match advertiser campaigns with publisher inventory; and Avenue A | Razorfish, which as one of the largest online ad agencies in the world, provides advertisers digital marketing consultation and media planning and buying.

“The advertising industry is evolving and growing at an incredible pace, moving increasingly toward online and IP-served platforms, which dramatically increases the importance of software for this industry,” Microsoft CEO Steve Ballmer said in a statement. “Today’s announcement represents the next step in the evolution of our ad network…”

Microsoft said it will use the aQuantive assets to create next-generation advertising systems, including cross media planning, video-on-demand and IPTV.

Microsoft expects to close the deal in the first half of its fiscal year 2008. aQuantive will continue to operate from its Seattle headquarters as part of Microsoft’s Online Services Business.

Should the deal go through without a hitch, Microsoft will have a powerful weapon to wield. To date, Microsoft has been criticized for not putting its best foot forward in the multi-billion-dollar market for landing ads on precious Internet real estate as Google, Yahoo and AOL increased their share of ad revenue.

Original URL: http://www.internetnews.com/bus-news/article.php/3678476

Any potential deal remains tentative and could break down, the source said. It could be weeks before a deal is announced.

“I really don’t want to comment,” said Garrett Camp, StumbleUpon’s chief software architect, when reached by phone.

EBay spokesman Catherine England declined to comment. “We don’t comment on rumors and speculation.”

Silicon Valley technology blogs TechCrunch and GigaOm reported on April 18 that eBay was in talks to acquire StumbleUpon in a deal worth between $40 million and $75 million.

StumbleUpon Inc. is an online review site that recommends interesting pages within sites like Flickr, MySpace or YouTube, based on the “thumbs up” or thumbs down” votes of other Web users with shared interests. It counts 2.3 million users.

It combines a social review site with search features and as such presents an alternative to Web search leader Google Inc.. The recommendation features built into the service could serve as a referral system for eBay users to locate Web auctions that interest them, analysts say.

Earlier this year, eBay acquired sports and entertainment event ticketing site StubHub for $307 million.

StumbleUpon, which helps Web users discover new sites based on the ratings of users with similar tastes, was founded in 2001 in Calgary, Canada. After one of its three Canadian founders completed his graduate thesis, the company relocated last year to San Francisco.

Late last year, StumbleUpon introduced a video-watching site that automatically finds and plays videos that match one’s interests to other viewers with shared tastes. The service makes watching short videos on the Web into the equivalent of online TV channels with an endless stream of programming.

Self-funded for next five years, StumbleUpon received a little under $1.5 million in funding in a year ago from investors including Google Inc. director Ram Shriram and Mitch Kapor, creator of the pioneering Lotus 1-2-3 spreadsheet software program.

Other investors were Josh Kopelman, founder of Half.com, which was acquired by eBay in 2000, and angel investor Ron Conway.

Original URL: http://news.yahoo.com/s/nm/20070509/wr_nm/stumbleupon_ebay_dc

Apparently Microsoft and Yahoo have spoken in the past, but Google has piled on the pressure with the DoubleClick deal and now Microsoft has asked Yahoo to re-enter talks about the acquisition.

Look at it from this point of view; Yahoo has had much more success on the web than Microsoft, and Google increasingly looks to challenge Microsoft with online office apps. There’s search, too – the two companies combined would command 27% of the search market against Google’s 65%. And of course there’s advertising, where Google is also dominant and Yahoo is building out Panama.

Is this a good or bad idea? In fairness, Microsoft could provide a powerful challenger to Google’s web dominance if the deal goes through, but if it does it would be the deal of the century!

Article adapted from: http://mashable.com/2007/05/04/microsoft-yahoo/