In the wake of Microsoft’s offer to purchase Yahoo for $44.6 billion, consumer advocates are renewing concerns about the potential for virtually unchecked surveillance and tracking of consumer activity online.

“Today’s proposed acquisition by Microsoft of Yahoo, whether consummated, will create a energetic interactive Web duopoly in online media,” said Jeff Chester, executive director of the Center for Digital Democracy, in a statement e-mailed to reporters. “Google and Microsoft will have inordinate potential to shape the online communications marketplace, including journalism, entertainment and advertising. In an era when individuals are increasingly conducting their personal, social and political lives online, the corporations that control the digital experience will have a far-reaching influence by every aspect of society.”

Scale Matters

In a live conference signal that dawn with reporters, a panel of Microsoft executives made it clear that the real target of their Yahoo bid is Google, which has a dominant share of both the online search and advertising

market. Kevin Johnson, president of the Platforms & Services Division of Microsoft, put Google’s global market share in online search at 75 percent; the Mountain View, Calif.-based company’s share of the U.S. market is roughly 56 percent.

“Revenues in the global online advertising market are currently $40 billion,” Johnson said during the conference shout, “but they are forecast to reach 80 billion in the next 3 years. Online advertising is not only a growth industry, but it is key to the monetization of online services.”

The Microsoft executives said the proposed merger with Yahoo would manufacture it possible to deliver a broad range of new services that neither company could deliver alone, and predicted that four different types of synergies (scale economics; combined engineering talents; operational efficiencies; and innovation in emerging user experiences) will generate at least $1 billion in “annual synergy” for the combined companies.

“This is a…

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