Techcrunch is reporting that Microsoft has just made an offer of 44.6 billion dollars in cash and shares for Yahoo.

The rumors had been circulating for a while now that MS was interested in purchasing Yahoo. Google’s dominance in both search and online advertising was/is making both Microsoft and Yahoo pretty nervous.

Microsoft’s offer directly broaches the subject of Google, even though Google isn’t directly mentioned. From the letter sent to Yahoo:

While online advertising growth continues, there are significant benefits of scale in advertising platform economics, in capital costs for search index build-out, and in research and development, making this a time of industry consolidation and convergence. Today, the market is increasingly dominated by one player who is consolidating its dominance through acquisition. Together, Microsoft and Yahoo! can offer a credible alternative for consumers, advertisers, and publishers. Synergies of this combination fall into four areas…

With Yahoos recent worries about its stock price and the talk of laying off thousands of staff, this is a strategically good time for Microsoft to pounce. Will the board of directors of Yahoo be nervous enough to sell? Maybe, maybe not.

At this stage Microsoft is approaching softly, as a friend offering a solution to the behemoth that is Google. If Yahoo refuse the approach, the next may be far less friendly.

And don’t forget that this has now opened the door to Google, or anyone else for that matter, to look at buying Yahoo. If they refuse the offer, will Google offer 50 billion?