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Via CNN:

Microsoft Corp. made an unsolicited $44.6 billion cash and stock bid for Yahoo on Friday, a deal that could shake up the competitive and lucrative market for online advertising.

(…)

Steve Ballmer, Microsoft’s chief executive, called the move the “next major milestone” for the software giant.

“We are very, very confident this is the right path for Microsoft and for Yahoo,” he said.

Microsoft hopes to close the deal by the end of the year. Ballmer said that Microsoft has been in “off and on” talks with Yahoo for 18 months and said he called Yahoo CEO Jerry Yang Thursday night to tell him the bid was coming.

It’s still difficult to say what an acquisition of Yahoo by Microsoft would really mean for the online advertising market and the domain channel. Together, these two companies would for sure become a powerful search engine giant and gain on Google. If Microsoft then figured out how to effectively monetize the traffic of social networks such as Facebook, which the Redmond-based company owns a 1.6 percent stake in, it would catch up even further, because Google hasn’t found a way to increase their ad revenue from social networks, yet.

But what are other possible effects of this acquisition? Well, it would be interesting to see how Microsoft and Yahoo merge their search engines and advertisement platforms, and how this would influence the domain market: Will click prices go up, down? What will change at the parking companies aside from the cost-per-click? Can Microsoft use the popularity of its Windows operating system and Internet Explorer web browser to promote its search engine? If yes, could it influence the way people surf the web, could it influence direct navigation traffic?

It is still early and the deal hasn’t even been completed yet. The future will tell if Microsoft/Yahoo can change the web landscape or if Google will remain the sole real innovator on the Internet.

If you’d like to read another opinion on Microsoft-Yahoo, Andrew of Domain Name Wire has written a nice piece with his thoughts on this possible acquisition. Read it here.