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Microsoft and Yahoo talk search

Both companies enter discussions to remain competitive as Google mounts its domination in the online world

Microsoft and Yahoo! are reportedly back in talks to forge a partnership in the online world.

There has been growing expectations that both companies would enter into negotiations again after Yahoo’s new CEO, Carol Bartz, took over from her predecessor Jerry Yang in January.

Yahoo! had earlier rejected a buyout offer from Microsoft for $31 per share in February last year, which Yahoo’s ex-CEO Jerry Yang said "substantially undervalues" the company. Yang eventually stepped down as CEO in November, facing criticism over the rejection and for even failing to complete an advertising deal with rivals Google that seem bent on online world domination.

Recent talks between Bartz and Microsoft’s CEO Steve Ballmer were confirmed by one person familiar with the discussions, according to the Financial Times daily with technology blog All Things Digital stating that the topics are wide-ranging - including discussions for Microsoft to handle Yahoo’s search advertising business and for Yahoo! to combine and run both companies display advertising dealings.

Both companies have yet to officially confirm the discussions and declined to comment on speculation.