Microsoft, Yahoo Back At the Bargaining Table

Microsoft and Yahoo are back in talks, this time discussing an "alternative transaction" that would pair the companies in the world of online search advertising.?In light of developments since the withdrawal of the Microsoft proposal to acquire Yahoo! Inc., Microsoft announced that it is continuing to explore and pursue its alternatives to improve and expand its online services and advertising business," Microsoft said in a statement released Sunday. The two-paragraph press release also said Microsoft was not planning to rebid for Yahoo, "but reserves the right to reconsider that alternative depending on future developments and discussions."

In a separate letter to Microsoft employees, Windows and Windows Live chief Kevin Johnson said a "major initiative" in search would be announced on Wednesday. The proposed deal is along the same lines of an alliance Yahoo has been discussing with Google and is also expected to be revealed this week. Such a pact with Microsoft, however, has a greater chance of passing regulatory scrutiny than one with Google, which would tie up 90 percent of the search market, according to Wired.Wired