A few folks out on the blogosphere have commented over the last few days that Microsoft may very well take the proceeds from Yahoo! and buy a series of smaller Web 2.0 businesses to quickly become relevant on the Web. The more I think about this, the more I think it’s a great idea. Let’s face it… Microsoft could purchase half of the Top 25 Web 2.0 sites for a mere fraction of what it spent on Yahoo! And while that wouldn’t alone get the traffic that Yahoo! would provide, it could help if an acquisition spree were supplemented by a corresponding increased investment in Live Services, Mesh, and Adcenter. All of that would be considerably cheaper than a $47b acquisition of Yahoo!
For what it’s worth, I think history will judge Microsoft favorably for not breaking the bank to buy Yahoo. Yahoo is a dead man walking especially if it isn’t able to become truly relevant again.
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