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November 10, 2005

Yahoo to AOL: I'll Pass

Yahoo's apparently backed out of contention for purchasing a chunk of AOL. Sticking point: Yahoo wanted a majority stake; Time Warner didn't want to give that much up.

I would speculate that Yahoo's not so much concerned with owning a piece of AOL as they are with making sure Microsoft doesn't. Big slabs of jiucy AOL traffic might be just the thing MSN needs to get adCenter off the ground, and Yahoo and Google both have a vested interest in preventing a strong third player from entering the PPC game.

But, all things being equal, Yahoo'd probably rather see Google/Comcast spend the money to put the screws to Microsoft, rather than shelling out the billions itself.