Why MSN Wont Buy AOL

Why MSN Won’t Buy AOL
You may have seen the online headlines this week “MSN in talks with AOL execs to buy AOL from Time/Warner.” At first glance you may think “wow that would make MSN pretty powerful.” After all, while AOL’s customer base is shrinking, it is still substantial. MSN’s reach is expanding, especially as the portal continues to grow in popularity. By merging these two client bases, Microsoft would have an impressive number of paying portal customers. Whether one portal was dropped in favor of the other would remain to be seen, but they could end up with about of the world’s internet portal customers.

So you are probably wondering: why won’t this happen? One word: Competition.

Microsoft has already faced a barrage of anti-trust lawsuits filed by various US and global governments citing its apparent monopoly on the computer software/operating system market. In fact, in the most recent ruling against them by the EU, the company was fined many hundreds of millions of dollars for stifling competition in the European Union. Or course, Microsoft will appeal and likely settle out of court for an undisclosed amount of money, all the time preaching their innocence.

But that stifling of competition is why Microsoft will not buy AOL. In fact, they likely can not buy AOL because of the assets the company has. If you look at it in these terms you begin to understand.

Let’s start with browsers. AOL owns Netscape. Sure, it isn’t much of a player anymore, but for Microsoft to buy this company, they could effectively put Netscape out of business. Not that Microsoft didn’t already do that with the settlement they reached last year with AOL.

There is also ICQ and AIM, both instant messenger platforms are owned by AOL. MSN could shut both down with the purchase. AOL also owns Mapquest.com, a competitor to Microsoft Mappoint and they own Winamp.com, which is a direct competitor to Windows Media player.

There are also a few others, like MovieFone.com, CompuServe and the ODP (DMOZ.org) which aren’t necessarily direct competitors to MSN or Microsoft, but would be a loss for the internet if Microsoft purchased them.

So when you consider that AOL is a direct competitor of Microsoft and/or MSN in more than a dozen different markets, you can see that even if they did make an offer, it’s highly unlikely that such a merger would be approved by the various regulatory boards located on American soil. Not to mention the various world governments and other organizations which would lose sleep over such a merger. This is why I don’t think Microsoft could make a play for AOL.

But consider this option. What if (and this is probably more of a long stretch than an MSN/AOL merger) Microsoft and Google formed a temporary alliance and bought AOL and its assets and divided them among themselves. Google could get control of those properties which they don’t already compete in (such as AIM or ICQ, Mapquest and Winamp) while Microsoft could get the portal and its customers.

This scenario is probably more of a stretch than the one where Microsoft buys AOL. But as we’ve found in the past, with search and search engines you just never know.

Author Bio:
Rob Sullivan
Production Manager
Searchengineposition.com
Search Engine Positioning Specialists