Microsoft's (Nasdaq: MSFT) unsolicited offer to buy Yahoo! (Nasdaq: YHOO) on Friday was bold.

I'm surprised there hasn't been a more favorable response to it. Did anyone think Yahoo! was capable of nursing itself back to health? Is there no denying that Microsoft had to act quickly before Google's (Nasdaq: GOOG) dominance in paid search eats into Microsoft's healthier business as software migrates online?

Several weeks ago, I explored the five reasons why Microsoft and Yahoo! should combine, and now is a good time to go over them again.

1. 2 + 3 is still less than 1
Even if the Department of Justice suggests that it wants to take a close look at this deal, it's unlikely to get in the way. My original argument played off the Nielsen Online data for November that showed Google well ahead of everybody.

November Share of Searches







Source: Nielsen Online.

Microsoft could buy everything not named Google and still get away with it. That's the one cookie jar Mr. Softy is allowed to take from. Why else did it get its $6 billion deal for aQuantive seamlessly approved last year while Google is jumping through hoops to pay half as much for DoubleClick?

The global data is even more disturbing for Googlephobes, where Google's market share actually expands to 62.4%, while Yahoo! and Microsoft slices shrink to 12.8% and 2.9%, respectively. Yahoo! and Microsoft might combine for less than 30% of domestic search queries, but they're actually serving less than 16% of the world's search requests.

In short, it's not a matter of antitrust. It's a matter of what else Microsoft will buy after it assimilates Yahoo! Could it be ValueClick (Nasdaq: VCLK) to eat into affiliate advertising? Or perhaps Akamai (Nasdaq: AKAM) to cash in on content delivery networks? It doesn't end here. The math won't let it.

2. Turn a bleeder into a leader
Things have gotten worse since last month when I argued that Microsoft and Yahoo! could realize serious synergies if they joined forces. Microsoft posted another quarterly loss at its online division. Yahoo!'s report was another disaster, with an anemic online advertising gain and a year-over-year dip in the ad revenue generated on third-party websites.

Shaving costs won't give either company Googlelike profitability, but it's a worthy tourniquet that will give the united underdogs time. Since Yahoo! is set to send out pink slips later this month anyway, it may as well wait and let Microsoft play Simon Cowell as it decides who stays and who will go home.

3. Microsoft must wean itself from the software cash cow
Does anyone know what the next Windows or Office will look like? Of course not. The world is slowly migrating to open source platforms and Web-stored apps. Anybody who argues that Microsoft is throwing too much money at its profitless subsidiary with this deal doesn't understand that the cash cow is unlikely to last forever.

Microsoft has a few good years left, but will it matter in a few years if you are using Office or Google Apps or Sun Microsystems' (Nasdaq: JAVA) Open Office? Or when more connectivity is done through browser-agnostic gadgets and appliances?

If the future is going to cyberspace, Microsoft is doing the right thing by expanding before Google starts going all Cloverfield on the competition.

4. Yahoo! is a ticket to the East
A good chunk of Yahoo!'s value rests in its stakes in Yahoo! Japan, Ali Baba, and Gmarket (Nasdaq: GMKT). Even during Yahoo!'s conference call last week, the troubled company pointed out that those investments are worth at least $10 a share.

Not only does it make the rest of Yahoo! appealing at the price that Microsoft will be paying, it also opens Asian markets where Microsoft -- and MSN -- have had a tough time competing.

5. Get in under the regulatory cutoff
There will come a time when regulators claim there has been too much consolidation in the sector. If so, Microsoft better hope that it's because of its own gluttony and not because Yahoo! decided to cowboy up and go on a buying spree of its own.

In fact, both Yahoo! and Microsoft were busy in 2007 snapping up smaller players, and it seems regulators are unlikely to flinch until everything but Google has been snapped up. However, you don't want to leave anything to chance. Now is the time to buy the biggest tool that can take on Google, and right now that just happens to be Yahoo!

Microsoft is an Inside Value selection. Akamai is a Rule Breakers newsletter pick. Yahoo! is a former Stock Advisor recommendation. Why are you missing out on these great stock picks? The answer may be waiting in free, 30-day passes to any or all of the newsletters.

Longtime Fool contributor Rick Munarriz isn't on Microsoft's buy list. It's a pity, because he's a cheap date. He does not own shares in any company in this story. He is also part of the Rule Breakers newsletter research team, seeking out tomorrow's ultimate growth stocks a day early. The Fool has a disclosure policy.