Ballmer discusses Yahoo acquisition rumour

Veteran US television interviewer Charlie Rose failed to get Microsoft CEO Steve Ballmer to reveal whether the Windows developer is still considering an acquisition of Yahoo.

"If we were I wouldn't tell you, if I weren't I wouldn't tell you," Ballmer said yesterday when asked point-blank by Rose in a joint interview with Cisco Systems' John Chambers if Microsoft was currently in negotiations with Yahoo to merge.

The two industry heavyweights appeared together in New York to discuss the collaboration between Microsoft and Cisco, which have begun to encroach on each other's territory in the areas of unified communications, network security and products for the digital home.

There was widespread speculation that Microsoft and Yahoo were talking about a possible deal earlier this year, speculation that was quieted by Microsoft's announcement it would buy digital media and marketing services firm aQuantive in May in a $6bn deal to boost its online advertising strategy. The deal, Microsoft's biggest to date, closed last week, and the possibility of the company purchasing Yahoo seemed a moot point.

Ballmer initially appeared to reignite Yahoo acquisition suspicions during Rose's line of questioning about Yahoo - he corrected Rose by saying "Why don't we buy Yahoo?" when asked by his interviewer why Microsoft "didn't" purchase the company.

However, in an interview following his joint public appearance with Chambers, Ballmer said Microsoft has no plans to do another massive deal like the aQuantive one to build out its advertising strategy. Instead, the company will focus on a combination of making smaller acquisitions and building new infrastructure where it is necessary to help Microsoft compete with advertising and search giant Google.

"We're going to buy more stuff and build more stuff...but we don't have a major conquest [in the works]," he said. "Sometimes we'll have to decide what's better - to buy or to build."

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