The three main web networks are shifting in response to control of access to the web. Today Yahoo!'s stock is down about 5% on reports of losing leverage in a deal with AT&T:
AT&T wants more out of the partnership, and Google seems to be ready to give the telephone company what it wants. The loss of AT&T’s business would be a blow to Yahoo not just because of the revenue it would forgo but because it would be another sign of its eclipse by Google.
While Yahoo! is losing its relevancy, Microsoft is working with allies to create a device that will allow free web access:
That bid has cast Microsoft and a group of powerful allies from Silicon Valley in the relatively unfamiliar role of Washington policy players.
Microsoft's prototype, delivered on behalf of the group, is a wireless device that could provide the public with free and more widespread access to the Web instead of relying on networks owned by big telecom and cable firms.
As the web moves to free Google will use their efficiency and Microsoft will use their cash hoard to buy marketshare. Microsoft's attempts to gain marketshare will likely lead to many easy arbitrage opportunities unless they get better at innovation and branding. Yahoo! will likely be relegated to the position of a large content play that eventually gets bought out by a media company to leverage Yahoo!'s exposure.