Microsoft should buy Yahoo: Jerry Yang

Yahoo Chief Executive Jerry Yang said that Microsoft should buy his pioneering internet firm despite failed takeover talks between the companies earlier this year.

"To this day, I would say the best thing for Microsoft is to buy Yahoo," Yang said yesterday, during an on-stage chat with journalist John Battelle at a Web 2.0 summit on Internet Age companies and their business strategies.

"Did we want to do the deal? Yes."

Microsoft has said repeatedly that it is no longer interested in buying the floundering Northern California firm.

"Our position hasn't changed," Microsoft said in a statement released in October. "Microsoft has no interest in acquiring Yahoo. There are no discussions between the companies."

The Redmond, Washington-based company issued the statement after Microsoft CEO Steve Ballmer commented that the business reasons for a Yahoo acquisition still make sense.

Microsoft on January 31 offered to buy Yahoo for $44.6 billion in a half-cash, half-stock deal.

Microsoft walked away from negotiations on May 3 after Yahoo rejected an offer it raised from $31 to $33 per share, which amounted to $47.5 billion.

"We believed, we were doing the right thing every step of the way," Yang said. "Both sides are to blame."

Yahoo stock was priced at $13.90 per share in after-hours trading yesterday.

Microsoft wanted to buy Yahoo to better battle Google, which claims the lion's share of the multibillion-dollar internet search and advertising market.