hmm i found something on the microsoft-yahoo merger too.

Basically News Corp is considering joining Microsoft in a bid for Yahoo, which is in talks to merge with AOL.

Effects of merger:

1) Merging of MySpace, Yahoo, Microsoft would result in a very fierce rival to Google as the merger would result in a three-in-one company consisting of an online social networking site, a search engine, and operating systems and web portal services (example: hotmail, MSN)

2) Yahoo to use the Time Warner cash and other funds to buy back several billion dollars worth of Yahoo stocks

>> increase/gain back a larger market share

3) Merger would draw antitrust scrutiny

>> antitrust law: supervising the mergers and acquisitions of large corporations, including some joint ventures. It prevents abusive beahviour by a firm from dominating a market, or anti-competitive practices that tend to lead to such a dominant postion. If Microsoft does get News Corp in on its bid for Yahoo!, the combination of Yahoo!, MSN, and MySpace would indeed act as a formidable competitor to Google.

4) Yahoo to boost revenue by 10%

>> "free up money to invest in stronger businesses" can include adding more services/ functions to its webpages, and hence differentiating its servies from its close competitor, Google. This decreases the substitutibility of Yahoo because of its improved or new range of services. Also, investing in stong businesses would make Yahoo a more stable company because stronger companies are less likely to close down during recessions,etc.