Ballmer hints of Microsoft-Yahoo pact against Google

Steve BallmerSan Francisco  - Microsoft CEO Steve Ballmer said Tuesday that he still wanted to form an alliance with Yahoo to combat the dominance of Google in search advertising.

But in his annual forecast to financial analysts of Microsoft's plans for the year, he ruled out any revival of last year's aborted deal to purchase Yahoo.

Ballmer also predicted that Microsoft would face more competition from Google and Apple in the market for computer software. He said that Google's Android operating systems for mobile phones would be converted for use in laptops.

"The seams between what's a PC operating system and what's a phone operating system will change," Ballmer said. To compete, the company is boosting investment in Windows, he said, according to Bloomberg News.

Ballmer told attendees at Microsoft's Strategic Meeting Update presentation that he would like to find a way for Yahoo and Microsoft "to pool resources" against Google.

"We are up against incredible odds," he said in reference to Google. "They have share. We don't have share. They have a huge team. We've got a much smaller team."

"I'm hoping that's a reasonable conversation to have with new management at Yahoo," Ballmer said.

But a report on broadcaster CNBC said the Seattle area software giant had been repeatedly rebuffed in his efforts to contact Yahoo's new CEO Carol Bartz.

Bartz took over last month from Yahoo founder Jerry Yang who was widely criticized for rejecting a 45-billion-dollar takeover offer from Microsoft last year.

Ballmer also acknowledged that the company's Internet Explorer web browser was losing market share to Firefox and other competitors. "Browsers are not commodities," Ballmer said. "There's a lot of work we need to do" to gain market share, he acknowledged. (dpa)

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