Deal with the devil

The best analysis of the Microhoo has been Kara Swisher’s, particularly her explanation of how Google ended up as the winner.

While Yahoo (YHOO) might not have wanted to be acquired by Microsoft (MSFT), its alternative to goose its revenues by relying on Google (GOOG) in an outsourced online search-ad deal is one it might regret even more if struck.

Why? Aside from the potential antitrust issues, which are distracting at the very least, it fundamentally puts one of Yahoo’s main businesses-search advertising-directly into the hands of the very company that killed off Yahoo’s chances of ever succeeding in the arena in the first place.

Yahoo has no visible strategy. Microsoft isn’t in much better shape. AOL remains a drag on TWX. Google wins again.