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Via Daring Fireball and the New York Times comes news that Microsoft seems intent on playing hardball in its pursuit of Yahoo.

Microsoft has begun to make preparations to proceed with a proxy fight against Yahoo as it seeks to gain control of the Internet company, people briefed on the matter said on Tuesday.

The aggressive tactic is part of the hard-nosed takeover campaign that Microsoft began two weeks ago. Unless Yahoo quickly reverses course and enters into merger talks, Microsoft will seek to nominate a slate of directors to Yahoo’s board by March 13, the deadline for nominations.

This seems like a bad move for both parties – a prolonged battle for control seems likely to end up with Yahoo losing more of its talent as the situation drags on and Microsoft, if it eventually ‘wins’, finding itself with little goodwill and a prize that turns out not to be worth as much as it was when this all began.

I’m unconvinced Microsoft is anywhere near being a company with the culture or understanding to exploit the potential that Yahoo undoubtedly has and I worry for the future of some of the services like Flickr and Delicious that Yahoo has either (kind interpretation) left to grow unhindered, or (unkind interpretation) not figured out what to do with. Not a happy situation.

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