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MicroHoo! -- Good for start-ups or not?

Alot of people are talking about whether the potential acquisition of Yahoo! by Microsoft will be good for the start-up world or not.  Some say it's bad.  Others say it's good.

I'm in the latter camp.  I think that these types of big combinations are much more likely to produce opportunity than to shrink the number of buyers that start-ups can sell to.

In fact, I think that this will increase the number of buyers for start-ups in the online space.  Google is already a big media company.  So is Yahoo.  Microsoft wiould become an even bigger media company if it is able to buy Yahoo.  But, there are plenty of other media companies that are smaller players or almost non-existent players in the online world that we think of as Google and Yahoo -- IAC, News Corp., Disney, NBC-Universal, Viacom. 

I think that all these media types will continue to converge, meaning that these big media companies need to bulk up their online offerings.  So, there will be at least as many acquirers out there, if not more, as there are today.

Second, a big merger like Microsoft/Yahoo will take a long time to complete and optimize.  Development will slow down in these two big companies as everyone worries more about their job than their product or service.  After the dust settles, there will be gaps in their offering that will have to be filled in order to catch back up.  Again, start-ups are likely to fulfill these needs.

Last, the convergence of all this media is bound to create more new opportunities.  Start-ups are more likely to identify these and capitalize on them quickly than big companies.

If Microsoft/Yahoo created a real monopoly, that would be bad for start-ups.  But, then again, everyone thought search was 'over' when Google started.  In technology, things are never done, you just have to look a bit further ahead.


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