The latest rumor floating around the potentially epic battle for a stake in AOL comes from the New York Times, whose Richard Siklos says Microsoft is now the “front-runner” in the negotiation for around half ownership of AOL.
The Times cites “two people involved in the negotiations” as sources on the matter.
All three major search players have expressed an interest in purchasing AOL, and speculation has extended to even include Rupert Murdoch’s News Corp., though some say that is unlikely given Fox’s competition with Time Warner in other media realms.
AOL and Google have had a relationship for years whereby AOL’s search results are powered by Google. Were Microsoft to acquire a stake in AOL, the combined search users of MSN and AOL would rocket third place MSN to first in search. The move is regarded as a type of kill-shot from Bill Gates and crew who are increasingly threatened by Google’s success.
Microsoft could use AOL’s platform and users to launch a more extensive advertising-based service. Siklos reports that the only barrier to an agreement between Microsoft and AOL is an offer “rich” enough to persuade AOL to cede control.
A deal with Microsoft would also meld MSN Messenger and Yahoo Messenger with AOL’s Instant Messenger for a massive cross-platform interoperability messaging service.
