Ballmer Huddles With Bartz; Google Eyes Twitter

After months of dancing around the topic, Microsoft CEO Steve Ballmer and Yahoo’s new CEO Carol Bartz finally had a face-to-face meeting recently to talk about whether the two companies can work out some kind of search and advertising relationship.

News of the meeting broke today with a story on the Wall Street Journal’s All Things Digital site.

Yesterday, the site also reported Microsoft (NASDAQ: MSFT) and Google are engaged in a match to see who will provide search capabilities on explosively popular social communications site, Twitter.

Microsoft executives went through a tumultuous – and ultimately unsuccessful — six-month battle to buy out Yahoo last year. Yahoo’s (NASDAQ: YHOO) struggle to block the hostile bid drove down the search firm’s stock price and led to the departure of co-founder and CEO Jerry Yang from the top spot. He retains his Chief Yahoo title and position on the company’s board.

Bartz, the former CEO of AutoCad who was hired as Yang’s replacement early this year, indicated earlier on that she’s not in favor of selling off any important assets such as Yahoo’s search or advertising businesses.

Meanwhile, Ballmer and other Microsoft executives have repeatedly and publicly expressed a desire for some sort of financial relationship with Yahoo. Those wishes may be in the process of being worked out, though there were no comments from either company.

Despite a huge investment over the years, Microsoft still lags behind both Google and Yahoo in consumer search. On the basis of searches worldwide, tracking firm Net Applications’ most recent figures show Google with 81 percent market share, while Yahoo has 10 percent, and both Microsoft’s MSN Search and Live Search combined coming in a poor third with five percent.

Is Twitter in play?

Meanwhile, rumors flew earlier this month that Google was in talks to buy out the microblogging company, Twitter.

Searching within popular social sites has become a potential sweet spot for advertisers, causing interest in sites like Facebook and Twitter to swell.

A Microsoft spokesperson declined to comment on questions regarding any dealings between the software behemoth and Yahoo.

Additionally, in regard to questions about negotiations with Twitter over search, the spokesperson said, “Microsoft does not comment on rumors or speculation.”

A Google (NASDAQ: GOOG) spokesperson gave an almost identical disclaimer in a statement e-mailed to

A spokesperson for Yahoo also declined to comment, while a Twitter representative did not respond to questions by press time.

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