Analysts, reacting to yesterday's announcement that Google has significantly expanded its partnership with AOL, say the stakes were significantly higher for Google to secure its partnership with AOL
than it was for Microsoft, the rejected suitor in the negotiations. "For Microsoft it was kind of nice to have," one said. "For Google it was a must have." In the end, Microsoft was unwilling to place
a cash investment in AOL, sources involved in the discussions said, and that could have been the difference. As part of the deal, Google has invested $1 billion in the Time Warner company. The news is
certainly not good for Microsoft, however, especially as the massive company aims to move its software business online. It now means Microsoft has a lot more to do if it wants to play Google and
Yahoo! at their own game.
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