Why The DoJ won’t mess with any MSFT-YHOO deal

I had a request from a reporter about whether the telegraphing of the potential acquisition might be an intent to flush out the DoJ, and preempt any problems in that respect.

Here is my take on that:

There has already been a sea change at the DoJ. Oracle killed the DoJ’s authority when it took it to court for trying to block the Peoplesoft acquisition and won. It’s all about how you define a market, and market concentration.

If we look at the deal as an acquisition of a company in the advertising business, then Microsoft has no anti-competitive case to answer. Internet advertising is still a tiny proportion of the overall advertising market.

What might Google level a complaint about? Search? Somehow I can’t see Google attacking the acquisition on the basis MS might create a search monopoly. What is more search is still frankly a nascent industry. What would executives from IBM say, for example, if the DoJ asked them in court about search dominance? I can’t imagine they would say search is done. Or how about John Battelle as an expert witness. He would likely say search is only just getting started…

There is surprisingly little overlap in Yahoo and Microsoft’s businesses.

Obviously Microsoft has a somewhat different view of the DoJ than Oracle does, but there are probably similarities. Let’s face it, the last set of DoJ findings and remedies against MS amounted to very little. Microsoft may see the EU as a worthy if bloody annoying opponent, but the DoJ increasingly looks like a Sabre tooth tiger. Its teeth are for decoration, rather than hunting or fighting.