Some in Microsoft leadership are promoting a bold alliance in the battle against Google's hegemonic internet presence (particularly in search an online advertising) - joining forces with Yahoo, writes the Wall Street Journal (via SearchEngineLowdown), citing sources familiar with the matter. Apparently, "Microsoft has considered the idea of acquiring a stake in Yahoo, and that the two companies have discussed possible options over the course of the past year," though an equity deal is not on the table now, according to the article.

There is pressure on Microsoft from shareholders and online advertisers that want an alternative to Google. One sign that Microsoft may resort to bold tactics is the recent hiring of former Ask.com CEO Steve Berkowitz to head MSN. Combined, MSN and Yahoo would have the three elements - strong technology, a mass of consumers and a universe of different advertisers - necessary to challenge Google, according to the WSJ article. One option may be for Microsoft to sell MSN to Yahoo and retain a minority stake.

Along those lines, Danny Sullivan of SearchEngineWatch seems to think a potential tie-up between Microsoft and Yahoo make sense: "Yahoo provides plenty of traffic, along with core search technology and a healthy, first-hand advertiser base."

The WSJ story comes in the wake of stories pointing to an "arms race" between Google and Microsoft as well as a "counterattack" by Yahoo and MSN.