New York - AOL (NYSE: TWX) could emerge as the big winner of this weekend's failed mega-deal between Microsoft (NASD: MSFT) and Yahoo (NASD: YHOO), with both companies potentially seeking to acquire the Time Warner unit in their efforts to better compete with Internet ad leader Google, The Wall Street Journal reported. "Both companies may turn their attention to the struggling Internet business, providing Time Warner Chief Executive Jeff Bewkes with a possible exit strategy," The Journal reported.

Redmond, Wash. - Shares of Yahoo (NASD: YHOO) fell 15% by late Monday, two days after Microsoft (NASD: MSFT) withdrew its $47.5 billion takeover bid for the company. A deal, which had been more than three months in the making, appeared to be close to fruition last week, when Microsoft agreed to raise its offer by $4 a share -- roughly $5 billion -- to $33 a share. According to Microsoft CEO Steve Ballmer, however, Yahoo CEO Jerry Yang rejected the deal, insisting the offer be raised to at least $37 a share.

Sunnyvale, Calif. - Hoping to avoid a messy proxy battle, Microsoft has increased its bid for Sunnyvale-based Yahoo by "several dollars," The New York Times reported on its web site late Friday. Specific financial terms being discussed have not been disclosed, though Microsoft reportedly has raised the possibility of increasing its current $29.30-per-share offer to as much as $33.

New York - A federal judge in New York has created a formula for calculating the royalties that large webcasters AOL (NYSE: TWX), RealNetworks (NASD: RNWK) and Yahoo (NASD: YHOO) must pay songwriters and music publishers for streaming their songs between 2002 and 2009, which could provide just one performing rights organization, ASCAP, as much as $100 million in payments. U.S. District Judge William Conner's ruling stipulates that the webcasters must pay 2.5% of music-related revenue to ASCAP's 320,000 members; by that math, for 2006, AOL owes $5.95 million, and Yahoo owes $6.76 million.

San Francisco - CNET Networks (NASD: CNET) is expected to announce a broad expansion of its editorial and advertising partnership with Yahoo (NASD: YHOO), sources from both companies told AllThingsD.com. Under the deal, CNET will become the major supplier of technology news and product reviews on Yahoo. Yahoo will also sell some CNET ad inventory, while CNET will sell ads on some areas of Yahoo.

Washington - The Justice Department is investigating whether an advertising tie-up between Yahoo (NASD: YHOO) and Google (NASD: GOOG) violates antitrust laws, Reuters reported. Under a two-week test, scheduled to end this week, Yahoo is using Google's online ad system to provide relevant ads alongside its search results.

A colleague forwarded me a fantastic article from Ad Age "It's Web 3.0, and Someone Else's Content is King". The article is worth a read for anyone in the content business. The author, Matthew Creamer, suggests that Web 3.0 will be about monetizing the web's openness and points to examples in the news business of websites aggregating other people's content for profit. Are content aggregators in fact growing in popularity? The author cites Michael Wolff of Newser: "The space is heating up". According to internet usage data, is it?

Sunnyvale, Calif. - Following what is said to have been a successful week-long test, Yahoo (NASD: YHOO) is now seeking to partner with Google (NASD: GOOG) to provide ads alongside its search results, the Wall Street Journal reported. The tie-up with Google would be a key element to a prospective deal where Time Warner (NYSE: TWX) would merge with Yahoo, and take a stake in the company, according to Reuters.

Online video is a hot topic these days with new entrants coming online (e.g. PluggedIn) and out of beta (e.g. Hulu) every day. We are seeing users spend a bit more more time with the video websites, spending an average of 16 minutes and 12 seconds for the week ending April 12, 2008 as compared to 15 minutes and 14 seconds during the same week last year. One interesting trend that I have noticed is that search engines and social networks are now accounting for an equal share of referred traffic. Last week (ending April 12, 2008) the share of upstream traffic from search increased 35% over the same week the previous year, while the referred traffic from social networks declined 20%.

Sunnyvale, Calif. - Yahoo (NASD: YHOO) announced on Thursday a three-year video and advertising partnership with MLB Advanced Media, that will see out-of-market MLB games streamed live and on-demand on Yahoo Sports.

Pity the poor regulator who, someday soon, will be faced with evaluating some proposed combination of all or parts of Microsoft, Yahoo, AOL and/or News Corp. (is there anyone else left?). What yardstick would you even apply? Someday, they're all going to be in the same combination of the content creation/distribution business, online advertising, applications development and platforms and social networking anyway. It's really only a question of how they get there and when, not whether or even should they. Trying to come to grips with that through the keyhole of any one deal or company is probably not a formula for a coherent regulatory framework for the future of the digital media industry.

New York - News Corporation (NYSE: NWS) is in negotiations with Microsoft (NASD: MSFT) to join its hostile takeover bid for Yahoo (NASD: YHOO), while Yahoo, which has rebuffed Microsoft's advances, has itself been holding talks with AOL and News Corp., The New York Times reported on Thursday. Should News Corp. join Microsoft in its offer, Yahoo would likely see a higher bid made than Microsoft's current offer, in a deal that would combine Yahoo with Microsoft's MSN and News Corp.'s MySpace.

Sunnyvale, Calif. - In the midst of its efforts to ward off -- or sweeten -- a takeover bid from Microsoft (NASD: MSFT), Yahoo (NASD: YHOO) announced on Wednesday that it will embark on a limited test of Google's (NASD: GOOG) AdSense for Search service, which will deliver Google's ads alongside Yahoo's own search results.

Sunnyvale, Calif. - Yahoo's (NASD: YHOO) Flickr photo-sharing site on Wednesday launched an anticipated video-sharing feature for its 42 million monthly users.

Sunnyvale, Calif. - Yahoo (NASD: YHOO) announced on Wednesday that it will acquire the assets of IndexTools, a provider of Web analytics software for online marketing.