Yahoo! and Microsoft to share a bed? - Just on the heels of the story of eBay looking to find partners to help them compete against Google, a rumour that suggested Yahoo! and/or MSN as potential suitors, is the rumour that Microsoft is possibly looking to partner with Yahoo! in a bid to better compete against Google. The power of the search engineÂ? and the revenue generated is phenomenal, but it is unlikely that this will happen. Microsoft is in the middle of a re-organization that will increase their net-presence, and Yahoo! has made their own agressive moves through acquisitions that would compete with Microsoft’s core business, software. There are several reasons this may make sense, but look no further than the Compaq/HP merger to find reasons to not jump into this too quickly.

Skype Adds Skypecasts - This could be the first bigÂ? move for Ebay’s Skype. The beta version 2.5 is being released today with a variety of new features. Skypecasts, one of the new features, allows individuals to host their own public presentations of up to 100 people. The host can mute and pass the microphone to other users, and pre-schedule their Skypecast with their own set of tags for the public to follow. Throw in a few “radio” ads or charge businesses or keynote speakers for the service, and suddenly there’s a new source of revenue.

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More proof Microsoft is heading in the right direction - Demand Media raised $120 million from investorsÂ? to capitalize on the Internet advertising boom. Richard Rosenblatt, former chairman of MySpace, has teamed up with Shawn Colo of Spectrum Equity Investors to create the company, Demand Media Inc, that will focus on creating a network of sites like flashgames.com. Flashgames.com doesn’t even have games, but because of the power of the URL and PPC ads from Google and Yahoo!, the site is said to generate over $150,000 a year. The duo will put a spin on these “empty” sites by sprinkling some content, some of which they hope will be generated by the public. The whole idea seems pretty unreal - but it shows the power of a name, whether it’s a person’s name or a URL.

An article by Mike Davidson, chief executive of Newsvine, suggests that MySpace has created a website that capitlizes on Internet advertising as well, with an unnecessary number of clicks. In our review of MySpace, we commented on the site flow being clumsy, and although we agree that what MySpace does isn’t illegal, we definitely would follow a Google-like scenario ourselves and make it easier on the users.

Both of these cases point to the incredible potential of Internet advertising, and supports the move of Microsoft towards an online, ad-rich company that capitalizes on the half a trillion dollar a year advertising industry.

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