Google: MSFT Bid Raises ‘Troubling Questions'; Openness Mantra Again; MSFT Responds: We’d Be No 2

Google (NSDQ: GOOG) has fired back on Microsoft’s (NSDQ: MSFT) $44.6 billion bid for Yahoo (NSDQ: YHOO), and said in an official blog post the bid “raises troubling questions..it’s about preserving the underlying principles of the Internet: openness and innovation.” This argument is along the same lines it made on opening up the wireless spectrum, and of course lobbied on it to half-success.

It also has the whiff of what Microsoft argued against the Google-DoubleClick deal: too much concentration of online power with one company. This latest post from David Drummond, SVP, corp dev and chief legal officer, asks one main question, three different ways:
— Could Microsoft now attempt to exert the same sort of inappropriate and illegal influence over the Internet that it did with the PC?
— Could the acquisition of Yahoo allow Microsoft — despite its legacy of serious legal and regulatory offenses — to extend unfair practices from browsers and operating systems to the Internet?
— Could a combination of the two take advantage of a PC software monopoly to unfairly limit the ability of consumers to freely access competitors’ email, IM, and web-based services?

Seems a tad ironic…

Updated: Microsoft responds to Google’s statement with a carefully worded statement, which pokes at Google’s dominance in search, and plays up its No 2 positioning even if the deal goes through: “The combination of Microsoft and Yahoo! will create a more competitive marketplace by establishing a compelling number two competitor for Internet search and online advertising. The alternative scenarios only lead to less competition on the Internet…Google has amassed about 75 percent of paid search revenues worldwide and its share continues to grow. According to published reports, Google currently has more than 65 percent search query share in the U.S. and more than 85 percent in Europe. Microsoft and Yahoo! on the other hand have roughly 30 percent combined in the U.S. and approximately 10 percent combined in Europe.”

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