I'm not going to go into depth on the news that Microsoft has bid $44.6 billion as it will be covered (to death) in a million and one places (and I don't really have time to write any kind of blog post as I have two interviews this afternoon, a report to write and a load of calls to return).
I just wanted to make a few observations:
1. as I'm sure other people have noted the valuation put on Yahoo! is almost exactly 3 times the crazy extrapolated Facebook valuation 2. the half-cash / half-shares offer uses more than half of Microsoft's total cash pile - which I think has to be a good thing in terms of proving that they are putting their money where their mouth is (mouths are?) about being serious that they are going to compete with Google 3. this isn't just about search. It's easy to think it is from within the SEO world, but remember that Yahoo! is more than a search engine (thankfully!) and presumably Microsoft has plans for pretty much all of it.
I'm going to end with a graph of (rebased) share prices for MSFT, YHOO and GOOG over the last year. I'm not sure exactly what implications to draw from it (I'm not a corporate finance specialist) but I think it's interesting: