Yahoo! Gets Del.icio.us

The only suprising thing about Yahoo's acquisition of del.icio.us is that Yahoo got there before Google.

The three-way battle between Microsoft, Google and Yahoo for dominance hinges on who can colonise the Web 2.0 space first. Google seemed to be ahead, with its steady roll-out of services like Gmail (albeit in beta) and purchase of Blogger and Picasa. But Yahoo is coming on strongly: now that it has both Flickr and del.icio.us it has started to catch up fast.

The dark horse, as ever is Microsoft: its recent announcement of Windows and Office Live show that it does not intend to be left behind. But unlike its previous spurts to overtake early leaders like Netscape, this one requires something more profound than mere technical savvy or marketing might.

Web 2.0 has at its heart sharing and openness (think blogs, Flickr, del.icio.us etc.). For Microsoft to succeed, it needs to embrace a philosophy which is essentially antithetical to everything it has done in its history. Bill Gates is a brilliant manager, and he has many thousands of very clever people working for him, but this may not be enough. Even as it tries to demonstrate "openness" - through SharedSource, or "opening" its Office XML formats - the limits of Microsoft's ability fully to embrace openness become clearer. But that is the point about being real open: it is all or nothing.

The question is not so much whether Microsoft will ever get it - everything in its corporate DNA says it won't - but whether Google and Yahoo will. In this sense, Web 2.0 is theirs to lose, rather than for Microsoft to win.