Keeping an eye on the recent goings on within the search marketing world you cannot fail to notice what is currently going on with Yahoo!. With the recent takeover bids from Microsoft, the latest being $44.6 billion, Yahoo! has been trying to find a path away from being enveloped by the software giant. Last week’s announcement that the company had entered into a 2 week experiment with Google to use Google Adsense on 3% of their search results seems to be a stalling tactic and one which is not appreciated by Microsoft. Yahoo! in the meantime are exploring the possibility of merging with AOL, whilst Microsoft are potentially seeking additional partners for the deal (with News Corp, who own MySpace, being rumoured to be joining the bid).

This raises many questions as to what the future holds for Yahoo! and sites such as Flickr and delicious, which they own. If Yahoo! are to merge with any of the options that are being rumoured at the moment then what position does this leave them in? Any merger with Google will be instantly reviewed under monopoly guidelines so it just doesn’t seem likely that this is the right way to go for Yahoo!. However, combining with AOL will hopefully maintain their company identity and allow them to continue business as they are doing, but in a more financially protected position. As for the Microsoft bid, which on the face of it is probably the best option for the Yahoo! shareholders, would Yahoo! just be swallowed up by the software giant or would it be allowed to operate as a partner with both MSN Live and MySpace (if News Corp do join in).

With all the current speculation going on it’s very hard to see which way this is going, the only constant seems to be that Yahoo! is in a precarious position and is going to have to fight hard to maintain it’s identity and brand.