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Microsoft Pri0

Welcome to Microsoft Pri0: That's Microspeak for top priority, and that's the news and observations you'll find here from Seattle Times technology reporter Matt Day.

May 9, 2007 at 2:26 PM

SAS: Semel mum on rumors

Yahoo! Chairman and CEO Terry Semel spoke not a word about the rumors of a partnership between his company and Microsoft in Seattle today.

He gave a brief, mundane keynote to close Microsoft’s Strategic Account Summit, a gathering of top advertising executives. After that he chatted on stage with Microsoft’s Joanne Bradford, but their talk never hinted at or even joked about a possible combination. There was no opportunity for questions from the audience or the press.

Semel, whom Bradford described as “the Hollywood guy in the Internet space,” did describe some things that Yahoo! and Microsoft have in common, and poked at what may be the Achilles heel of their mutual rival on the Web, Google.

“Either of us could have been in the YouTube look-a-like and violate all the copyrights over night and do all that stuff,” he said, in reference to the online video-sharing site Google acquired for $1.76 billion in November. The site was subsequently sued by major media companies for copyright infringement because users made a habit of posting popular clips from “The Daily Show” and other professional content. “We chose to think of [media companies] as long-term partners, potential partners that we could do a lot of stuff with.”

He did make one mention of getting people in Yahoo! and Microsoft together to talk about improving standards for online video advertising. But that wouldn’t be any kind of exclusive business deal.

Interest in Semel’s appearance here grew after reports last week that Microsoft and Yahoo! had been discussing in recent months a merger or other more limited partnership, perhaps around advertising. The acquisition price tag was estimated at $40 billion to $50 billion.

The acquisition rumors sent Yahoo! shares up nearly 10 percent Friday. Shares gave back some of those gains earlier this week following news late Friday that the acquisition talks were no longer active.

Yahoo! shares lost 19 cents Wednesday, down less than 1 percent, to $30.22.

Yahoo! has long been a rumored Microsoft acquisition target. The combined companies would present a more formidable challenge to Google in the fast-growing business of online advertising.

But an appearance at Microsoft’s Strategic Account Summit clearly is indicative of nothing. Semel has presented in the past, as has Google CEO Eric Schmidt.

Some analysts gave a possible Yahoo!-Microsoft partnership a chilly reception, citing the huge costs of integrating the companies’ technologies and cultures.

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