The speculation-o-meter’s absurdity dial is on 11. According to SmartMoney columnist James Stewart, who should know better (Den of Thieves – good book, DisneyWar – not so much), writing in the Wall Street Journal:

    If Microsoft essentially buys all of Yahoo’s ad business, both search and display, then it gets nearly all the benefits of a merger. Yahoo would become a pure content company, basically outsourcing its ad business to Microsoft.

    There’s a deal that starts to make sense.

Yeah, that’s it. Buy Yahoo’s ad business but not its content business. Then it’d be a content company, not a media company.

Good lord, what does he think a media company is?!? Content is a way to get an audience you sell ads against, sir. One is very rarely in only one of those businesses, when one is in the Big Leagues. Only also-rans and niche players can completely outsource ad sales. Only market-dominating ad networks (see Google) are great businesses. Studios — content companies that license their content to ad sellers and others — are best served by multiple distributors, or by way-overpriced exclusives. Yahoo is not a studio.

Yahoo, Microsoft, and Google all aspire to Big League greatness. As well they should.