Microsoft CEO Steve Ballmer issued a letter to Yahoo CEO Jerry Yang over the weekend stating that the company withdrawing its offer to Yahoo. Microsoft had raised its bid to well over the $33 per share, upping it by nearly $5 billion which was still not enough to sway Yahoo board members.

“Despite our best efforts, including raising our bid by roughly $5 billion, Yahoo! has not moved toward accepting our offer. After careful consideration, we believe the economics demanded by Yahoo! do not make sense for us, and it is in the best interests of Microsoft stockholders, employees and other stakeholders to withdraw our proposal,” said Ballmer in the letter.

Yahoo CEO Jerry Yang on Monday shot back a letter in response to Microsoft CEO Steve Ballmer’s 3-week ultimatum for Yahoo to come to negotiations with a firm message that Yahoo has not changed their tune in regards to Microsoft taking over the search engine. Ballmer’s letter had spelled out plans for a proxy contest to unseat the exist Yahoo board of directors and that continued delays could reduce the $44.6 billion offer which would mean less for shareholders.

“Our board’s view of your proposal has not changed,” said Yang along with Chairman Roy Bostock. “We continue to believe that your proposal is not in the best interests of Yahoo and our shareholders.”

Instead of going through the negotiations Yahoo has chosen to beat their exclamation points into swords and fight back against Microsoft. Yang continued in the letter stating that the offer and proxy contest would not be in the best interest of Yahoo and certainly not part of a friendly transaction as Microsoft first proposed.

Microsoft issued another letter to the Yahoo board of directors on Saturday with a deadline of 3 weeks for the company to accept the previous $44.6 billion takeover offer that Microsoft proposed in the beginning of February. Despite some recent talks between the two companies, an agreement has not been made and Microsoft is starting to lean heavy on the search engine firm’s board by threatening to go straight to the shareholders if necessary.

“If we have not concluded an agreement within the next three weeks, we will be compelled to take our case directly to your shareholders, including the initiation of a proxy contest to elect an alternative slate of directors for the Yahoo! board,” the letter read. “The substantial premium reflected in our initial proposal anticipated a friendly transaction with you. If we are forced to take an offer directly to your shareholders, that action will have an undesirable impact on the value of your company from our perspective which will be reflected in the terms of our proposal.”, stated Steve Ballmer’s letter to Yahoo.

Microsoft announced Monday that it is going to acquire Danger, software maker for the popular consumer-targeted Sidekick mobile device. Reportedly the purchase came after months of negotiations, with Danger receiving a number of different offers and Microsoft doubling their original offer to keep Danger out of others hands. That offer has been rumored to be as much as $500 million, but no official terms of the deal have been revealed.

While Microsoft has done well making software for smartphones the company mostly targets business users and fewer general consumers. The Sidekick from Danger is almost the opposite and is aimed at the younger consumer-based market in which Microsoft seems to be keen on getting into. Microsoft also recently made a $44.6 billion offer to Yahoo to help build a larger online, consumer-facing presence and could have Danger in mind to be part of that overall strategy, working against dominate competitive figures like Google and RIM.

Yahoo is bringing to the mobile space a product it feels will make it more convenient to manage your social communications in one place. This product is called Yahoo oneConnect and the company expects it will be available in the second quarter of the year.

Yahoo oneConnect is built around an open architecture which brings together email, instant messaging (IM), text messaging (SMS), and social networks into one central, mobile location. A centrally managed “socially-connected” address book will let one view status updates, photo uploads and the recent activity of contacts across various social networks. This same open design will let one talk across a range of popular online services.

And the show down continues…Yahoo rejects Microsoft’s take over bid, Microsoft looks like it will go forward with it anyhow:

“It is unfortunate that Yahoo! has not embraced our full and fair proposal to combine our companies. Based on conversations with stakeholders of both companies, we are confident that moving forward promptly to consummate a transaction is in the best interests of all parties.

We are offering shareholders superior value and the opportunity to participate in the upside of the combined company. The combination also offers an increasingly exciting set of solutions for consumers, publishers and advertisers while becoming better positioned to compete in the online services market.

You can be pretty certain we haven’t heard the last from Microsoft regarding their offer to buy Yahoo!, but for now Yahoo! is saying a “no thanks” to the $44.6 billion buyout offer. Jerry Yang and other directors say Yahoo! are seeking at least $40 a share, or nearly $60 billion. Microsoft may not be willing to pay.

The bean counters of Yahoo! feel the number is on the low end. Others would like to get cozy with Google in order to improve search revenues, despite the fact that there may be some antitrust implications with that. Stayed tuned on this one. Things are getting very interesting.

With the buzz of the possible Microsoft takeover of Yahoo still fresh in the air, Google wasted no time in jumping in to say the deal could possibly create a monopoly which threatens “the underlying principles of the Internet: openness and innovation.” This, from Google’s chief legal counsel, prompted a quick response back from Microsoft’s chief legal counsel saying the merger will “create a more competitive marketplace by establishing a compelling number two competitor for Internet search and online advertising.”

Google’s David Drummond, Senior Vice President, Corporate Development and Chief Legal Officer, had this to say on Sunday - “The openness of the Internet is what made Google — and Yahoo! — possible. A good idea that users find useful spreads quickly. Businesses can be created around the idea. Users benefit from constant innovation. It’s what makes the Internet such an exciting place.

Microsoft announced this morning that it has official made an acquisition offer to Yahoo for the sum of $44.6 billion. Steve Ballmer on behalf of the Microsoft board of directors sent out a letter to Yahoo yesterday with the offer at $31 per share for all of Yahoo’s outstanding common stock.

According to the letter Microsoft has been in talks with Yahoo for some time, citing a letter in February of 2007 from Yahoo stating that “now is not the right time…”. Microsoft points out that things have not improved for Yahoo since earlier last year and without naming any other companies they refer to an increasingly dominate player in the market (we’re just guessing Google) who is increasing its own dominance by more acquisitions. Microsoft feels that combining forces with Yahoo increases the fighting chances in the online advertising space for both of them.

Suppose you own a company that both Microsoft and Google want to own a part of. Who do you choose to do a deal with? Do you base your decision on which company you think will be the stronger in the future or just on who’s offering the most cash? This is the present dilemma that Facebook owner Mark Zuckerberg is facing right now. Both Google and Microsoft are neck-and-neck with striking a deal that would see either one of the two online titans getting a 5-to-10 percent ownership with Facebook. The deal is expected to close sometime today or tomorrow.

The potential deal is likely to be huge for whomever gets it. Both Microsoft and Google are set up to capitalize on serving advertising to Facebook’s 34 million members. No one from either of the three companies is offering to comment about the deal but if the “The New York Times” is reporting that it exists, take it to the bank.

Google has announced an improved version of its Google Mini search appliance. The new Mini offers document and user-level security, access to other business applications through Google Onebox for Enterprise, and integration with Google Analytics.

The Google Mini is a combined hardware and software solution that can search from 50,000 up to 300,000 documents and 220 different file types. Mini was introduced two years ago as a small, simple and affordable appliance to aid small business in finding and sharing information.

Secure Search
The new Google Mini now offers document …

In a move that has surprised absolutely no one, Steve Jobs unveiled the new iPhone during his MacWorld keynote address. The device looks like a PDA and has no permanent buttons.

The iPhone as anticipated by many, and its introduction has raised Apple’s share price.

Jobs made a point to mention how smart phones aren’t very smart because of the fixed keyboard and the space that this wastes on most phones. Jobs also mentioned the fact that you can have visual voice mail, meaning you can view your voice mails like your email …

Yahoo introduced its “Yahoo Go for Mobile 2.0″ mobile tools collection at the CES yesterday. A key component to Yahoo’s mobile strategy is search and Yahoo hopes to gain ground in the crucial search market with its OneSearch product.

The product is still in beta, it is available for download. The Yahoo Go for Mobile 2.0 is an application that consists of a series of “widgets” that are built for easy usage on a mobile device. Besides search, users can access other Yahoo services like Flickr, e-mail, maps, …

Microsoft and Sprint have announced an alliance in which the companies will develop and deliver a range of mobile search services for Sprint’s business and consumer customers.

The initial offering enables Sprint customers to use Windows Live Search for mobile on their wireless phones to search location-based content from the Internet. The new mobile search service based on Windows Live aims to provide a single access point to relevant online content based on a keyword or phrase. The search will include the Sprint catalog of offerings such ring tones, games, and screen savers as well as …

Palm has announced the Palm Treo 680 smartphone, a GSM/GPRS/EDGE quad-band world phone with PDA features. The new Treo 680 comes with applications for email, web browsing, messaging, multimedia, calendar, contacts and quite a bit more. The feature set looks quite a bit like the 700p model, exept for the price which is a little less.

Palm is targeting the price savvy who want a more competitive mobile computing device at a more competitive price. With the introduction of this new device Palm plans to reach new users in the growing …