Microsoft Planning AOL Coup?

The Wall Street Journal reports today that the Microsoft-America Online talks are back on again.

This story talks more about some sort of alliance than an outright buyout, but one thing Microsoft could get out of a deal is a potentially hugechannel for its search offering. That would be very bad news for Microsoft's latest nemesis, Google. This is probably not a coincidence.

Google sells ads on AOL's sites. Any arrangement with Microsoft could end up being just one big distribution pact for Microsoft search.

Google sells search-engine advertisements for AOL generating about $300 million last year, according to the Journal. Some sort of combination of MSN and AOL's online services could spark regulatory concerns one could imagine, although with Yahoo and Google out there, maybe not. Reuters, following the Journal's story also mentions a possible spin-off of the two online services into a new entity.

Reuters, also citing unnamed sources, reports that the talks are being led by Time Warner Executive Vice President Olaf Olafsson and Microsoft Senior Vice President Henry Vigil.

What a long strange trip it's been since word first leaked (in CRN no less) that Microsoft was planning an online service to take on AOL, CompuServe, and Prodigy. On August 8, 1994, the page one headline here was: "Secret side of Chicago puts Microsoft online."