Microsoft considers Yahoo bid

Deal could help software giant gain online advertising market share against Google

Microsoft is set to make a takeover bid for internet giant Yahoo, which could be worth as much as $50bn, according to a report in the New York Post.

The deal could help Microsoft improve its online advertising revenues and better compete with Google. Yahoo could be worth as much as $50bn, according to the report.

After reports of the potential deal surfaced, Yahoo shares jumped by almost $5 to $33. If the deal went ahead, the merged company would own just over a quarter of the search advertising market, compared to Google’s two-thirds.

Meanwhile, Yahoo has been busy updating its instant messaging (IM) and mobile tools this week, allowing users to sign on to chat from any computer without the need to download software, and expanding its oneSearch mobile search program to UK users for the first time.

Yahoo Messenger for the Web can be accessed from any web browser, including Internet Explorer, FireFox and Opera, according to the company. Yahoo said the web-based version if its IM program could prove useful to travellers needing to access their messages from an internet café, for example. Subscribers can also chat to contacts using the Windows Live Messenger program.

However, UK users will have to wait to try out the new service. Yahoo Messenger for the Web is currently only available in six countries, including the US, Brazil and India.

When the updated version is rolled out to the UK, it could pose problems for IT managers as Yahoo is also targeting employees currently unable to use IM tools due to work restrictions on software downloads.

“Time at work just got a lot more fun,” wrote Yahoo product manager Sarah Bacon in a blog posting. “If you or a friend is prevented from IM’ing at the office due to firewalls or other IT restrictions, you’ll love this new version. Because Yahoo Messenger for the Web runs in a regular web browser window, it sidesteps these obstacles and lets you connect easily with your friends.”

On the mobile side, Yahoo has expanded its oneSearch tool to a further six countries, including the UK.

OneSearch is designed to provide users with relevant, instant search results from any mobile device with a browser and internet access. UK users will be able to access information such as local business listings, news, weather and web results.

The service also gives Yahoo another advertising revenue stream. Adverts will be served up through the mobile search application, and users can click through to the advertisers’ mobile web site.