Ever since Google Android mobile OS was announced last year, everyone has been guessing what is the Google’s endgame here.

Afterall, an operating system for mobile devices has very little to do with Internet search or advertising marketplace of Google AdWords and AdSense, which are the key elements of the power Google wields today.

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Facebook’s new face is drawing frowns from some of its users.

They’re grousing about a spanking new redesign intended to unclutter their profiles on the social network. Several groups requesting a return to the old design have surfaced, including one with 1 million members.

Facebook has shifted millions of users to its new design in a bid to draw more members and advertisers to a cleaner interface. Facebook’s torrid growth — it has added 90 million members the past two years — has put it in a prime position to vie for an estimated $2 billion market for social-networking ads this year.

Digg, the news site with the nerve to substitute the votes of the unwashed, unpaid masses for the refined talent of professional editors, has raised a new round of venture financing, the company said Wednesday.

Four-year-old Digg, based in San Francisco, raised $28.7 million from existing venture backers Greylock Partners, Silicon Valley Bank and the Omidyar Network. The round was led by the newcomer, Highland Capital Partners, whose partner Richard de Silva will join the Digg.com board. That brings the total amount of money raised by the still-unprofitable company to around $40 million.

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Microsoft Corp. has withdrawn its $42.3-billion (U.S.) bid to buy Yahoo Inc., scrapping an attempt to snap up the tarnished Internet icon in hopes of toppling online search and advertising leader Google Inc.

The decision to walk away from the deal came Saturday after last-ditch efforts to negotiate a mutually acceptable sale price proved unsuccessful.

The talks reached a breaking point after Jerry Yang and David Filo, the co-founders of Sunnyvale-based Yahoo, flew to Seattle in the morning to meet personally with Microsoft Chief Executive Steve Ballmer and Kevin Johnson, who runs the software maker’s unprofitable online services division, according to someone familiar with the talks. The person was not authorized to speak publicly and asked not to be identified.

“Clearly a deal is not to be,” Mr. Ballmer wrote to Mr. Yang in a letter sent late Saturday.

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Yahoo Inc. and Time Warner Inc.’s AOL are closing in on a deal to combine their Internet operations, a move aimed at thwarting Microsoft Corp.’s effort to acquire Yahoo, people familiar with the matter said Wednesday.

But Microsoft is recrafting its assault plan by talking with Rupert Murdoch’s News Corp., publisher of The Wall Street Journal, about mounting a joint bid for Yahoo, people familiar with the matter said. Microsoft and News Corp. have yet to reach an agreement on joining forces but one person apprised of the plan described the discussions as serious. Such a deal would combine three of the biggest Internet properties: News Corp.’s MySpace, Microsoft’s MSN and Yahoo.

Negotiating Leverage

The AOL-Yahoo deal under consideration would include the repurchase of some Yahoo shares at a price above Microsoft’s offer. Taken together with a possible search advertising pact with Google Inc., the plan could give Yahoo an alternative to a Microsoft takeover — although many analysts and investors believe Microsoft will ultimately win out. At the least, Yahoo’s efforts could give it more leverage to negotiate a higher price from Microsoft.

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In an unexpected move, AOL has acquired social-networking site Bebo. The price tag: $850 million in cash.

Rumors had floated over the past few months that Bebo, which has over 40 million members, was up for sale. Reports suggested a $1 billion price tag, but there were few hints as to potential buyers. Though Bebo had already partnered with AOL’s AIM messaging client to facilitate friend-invite interoperability between the two services, even the most creative blogger speculation didn’t seem to point to AOL eventually buying the social network.

Ironically, AOL itself has been talked about as an acquisition target. Jeffrey Bewkes, CEO of Time Warner, which operates AOL, has spoken recently about plans to spin off or sell divisions of the company.

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Yahoo Inc.’s rejection of Microsoft Corp.’s unsolicited takeover bid left investors guessing the next move in a tense mating dance that may hatch a more imposing challenger to Google Inc. or disintegrate into a bruising brawl.

The rebuff, formally announced early Monday, wasn’t a surprise because Yahoo had leaked its intention over the weekend.

As expected, Yahoo’s board unanimously decided to spurn Microsoft after concluding the offer — originally worth $44.6 billion or $31 per share — ‘’substantially undervalues” one of the Internet’s prized franchises. The cash-and stock deal is now valued at about $40 billion, or $28.91 per share, because of a drop in Microsoft’s market value.

But Yahoo didn’t raise antitrust concerns about the proposed deal and included language that seemed to invite a higher offer from Microsoft, the world’s largest software maker.

”The board of directors is continually evaluating all of its strategic options in the context of the rapidly evolving industry environment and we remain committed to pursuing initiatives that maximize value for all stockholders,” Yahoo said in a statement.

Microsoft, though, didn’t seem inclined to raise the bid Monday, releasing a statement describing its current bid as ”full and fair.”

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Unable to topple Google Inc. on its own, Microsoft Corp. is trying to force crippled rival Yahoo Inc. into a shotgun marriage, with a wager worth nearly $42 billion that the two companies together will have a better chance of tackling the Internet search leader.
Microsoft’s audacious attempt to buy Yahoo, spelled out in an unsolicited offer announced Friday, shows just how much Google threatens the world’s largest software maker’s grip on how people interact with computers.

For Yahoo, the bid represents another painful reminder of how missed opportunities and mismanagement combined to open the door for Google to supplant it as the Internet’s main gateway, decimating its stock price in the process.

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Microsoft Corp. said Tuesday it will pay about $1.2 billion to acquire Oslo, Norway-based Fast Search & Transfer as part of a move to expand its data-search business in the corporate market.

The Norwegian software developer, founded in 1997, develops technologies used by business customers to search their databases, although Fast Search has lately branched out into the field of online advertising.

Microsoft has been beefing up its search and online advertising capabilities to better compete with Google and Yahoo, although the Fast Search deal is unlikely to help the company in the consumer online market, analyst Brent Williams of The Benchmark Company told clients. He viewed the move as a “tuck-in deal rather than as a game-changing acquisition.”

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After opposing Google Inc.’s moves to dramatically reshape the wireless industry, Verizon Wireless is now in serious discussions with the Internet company over carrying phones tailored to a new Google operating system, a person familiar with the discussions said.

Within two weeks, Google is expected to announce new software and services that handsetmakers could use to build customized Google-powered phones. The company needs wireless operators to sign onto the project in order to get Google-powered mobile devices in front of consumers by the middle of next year.

A Google technology partnership might allow the carrier to offer cheaper phones, since Google’s licensing fees for its software and operating system would likely be lower than the industry standard, the person said. The carrier, a joint venture of Verizon Communications Inc. and Vodafone Group PLC, is also stocking up on attractive new phones to keep pace with AT&T Inc., which has gotten a boost from carrying Apple Inc.’s iPhone.

For Google, a partnership with Verizon, the second-largest U.S. wireless carrier, would give it access to 63.7 million potential customers. Google is also targeting at least one other major U.S. operator, Deutsche Telekom AG’s T-Mobile USA Inc.

Even so, a Verizon-Google tie-up would be surprising given how the two companies recently have sparred. Verizon has fought Google’s efforts in Washington to force wireless carriers to open their networks to more services. The wireless carrier tried to overturn rules that Google successfully pushed through the Federal Communications Commission relating to a coming radio spectrum auction

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