In the ongoing game of musical chairs among top managers at Internet companies, former Yahoo exec Brad Garlinghouse–famous for his controversial “Peanut Butter Manifesto,” which correctly chided the Internet giant for becoming so lugubrious several years ago–is taking a job at AOL very similar to the one he left at Yahoo last year.

Garlinghouse, 38, has been named president of Internet and mobile communications at AOL, putting him in charge of the New York-based Time Warner (TWX) online unit’s powerful email and instant-messaging properties, including ICQ and AIM.

He has only been in talks with AOL–which used Spencer Stuart’s Internet-top-exec-finder-in-chief Jim Citrin–for a few weeks, in a deal that came together quickly, he and the company said.

Garlinghouse, a longtime Web entrepreneur and exec, had reportedly been considering a number of start-up and venture-related jobs since he left Yahoo last summer after six years there.

Sources said he was seriously considering becoming the CEO of a mobile firm.

He was most recently at Silver Lake Partners, as an “in-house senior advisor,” the private equity firm that recently bought the Skype Internet telephony firm for $1.9 billion. Garlinghouse also reportedly helped work on that deal.

“It’s really exciting to be to able to rebuild and revitalize an industry giant,” said Garlinghouse in an interview with BoomTown earlier today. “I make no bones that these [properties] are in need of that…but there is also a huge opportunity to do something cool.”

Garlinghouse has to hurry. Despite being among the top communications players online–a group that also includes Yahoo (YHOO) and Microsoft (MSFT) and, more recently, Google (GOOG)–AOL has lost relevance with key audiences, even as social networking properties like Facebook and the microblogging service, Twitter, have innovated in the communications space.

The hiring of Garlinghouse, well known in Silicon Valley circles, is meant to counter that.

He will head up AOL’s operations from its Mountain View, Calif., campus–which is also the former HQ of AOL-acquired Netscape Communications–where, said AOL CEO Tim Armstrong, Garlinghouse will “be CEO of Silicon Valley for us.”

Between all its various properties, AOL has several hundred employees in the Northern California area.

Armstrong said AOL–which was founded 25 years ago on the East Coast and has tried and failed many times to get a true foothold in the West–thinks having an important player at the center of the tech industry is critical as it moves to spin off as an independent company by the end of the year.

“We have a triple play in getting a great executive, who is a master in the communications on the Web and who is well known out there,” said Armstrong. “Brad is our senior AOL manager there.”

Along with running all of AOL’s communications properties, Garlinghouse will inherit some of its community properties, although AOL’s Bebo social networking unit–now considered to be an overpriced acquisition error–now resides in its ventures unit, headed by Jon Brod.

Garlinghouse will also be aiding Brod, said Armstrong, with AOL on the lookout for acquisition opportunities in communications and other arenas.

While Garlinghouse declined to be specific about what would pique his buying interest, he was responsible for such big Yahoo deals as its $350 million purchase of Zimbra in the fall of 2007.

He was also key to bringing both Oddpost, which is at the heart of Yahoo’s email offering, and the popular Flickr photosharing service to Yahoo.

Garlinghouse said he has admired what Twitter and Facebook have done, but that they were not destroying traditional online communications, pioneered by AOL, as some assert.

“It’s a vibrant segment and this just means there are a lot of opportunities to enable integration,” he said. “I think of it as an expansion of online communications and I hope AOL can do more collaboration and partnerships.”

Garlinghouse also has to watch AOL’s basic products like email, which was recently passed by Google’s Gmail as the No. 3 email service in the U.S. Yahoo Mail is the top email, while Microsoft’s Hotmail is second.

How much Garlinghouse can do will depend on the future financial strength of AOL. Its advertising business has been hit hard in the econalpyse, with hopes it will return before its money-generating access business continues its slow decline.

Armstrong is now in the midst of looking over AOL’s cost structure and employee base, which most expect will eventually result in another round of layoffs and cuts.

He has been busy creating a different strategy for the company since he arrived earlier this year, as well as hiring (and firing) top execs to create a new management structure.

Now, that includes Garlinghouse.

So, for a look-see at AOL’s latest talent acquisition, here’s a video interview I did with him, just after Yahoo bought Zimbra:

And here’s the full press release from AOL about the hiring of Garlinghouse:

AOL NAMES BRAD GARLINGHOUSE AS PRESIDENT, INTERNET AND MOBILE COMMUNICATIONS

NEW YORK, N.Y.–September 8, 2009–AOL today named Brad Garlinghouse as President of Internet and Mobile Communications, spearheading AOL’s global efforts to expand the reach of its e-mail and instant messaging. Garlinghouse will also take on an expanded leadership position for the company, heading up AOL’s Silicon Valley operations from its Mountain View campus and serving as the West Coast lead for AOL Ventures, the company’s venture capital arm headed globally by Jon Brod. Garlinghouse was most recently at Silver Lake Partners as an in-house Senior Advisor.

Prior to Silver Lake, Garlinghouse spent nearly six years at Yahoo!, where he led that company’s communications and community products. Garlinghouse will report directly to AOL’s Chairman and CEO Tim Armstrong.

” Brad Garlinghouse is an all-star in the Internet industry with an unparalleled background and proven track record, having led Yahoo’s communications products to unprecedented growth,” said Armstrong. “In addition to leading our efforts to grow our communications products, Brad will be bringing his global leadership and business experience as a key member of our company’s executive leadership team. He will also be a major force for AOL in Silicon Valley, working to expand our presence there and in the tech community in general. We’re delighted to have Brad on board and know he’ll do great things for AOL.”

“It’s a tremendous opportunity to join AOL at this pivotal moment in its history,” Garlinghouse said. “Tim has set out a clear strategy and vision for where he is taking this company as it becomes independent again. I’m looking forward to working with him and the rest of the team to realize that vision.”

Armstrong, who joined AOL in April, identified Communications as one of the five key areas of strategic focus for AOL after an extensive 100-day review of the company’s business. Other focus areas include Content, Advertising, Local & Mapping and AOL Ventures.

Garlinghouse spent nearly six years at Yahoo! where he most recently served as SVP of Communications and Communities. Prior to that he served as SVP of Communications, Communities and Front Doors, which included the Yahoo! home page. He came to Yahoo in 2003 as VP, Communication Products. During his time there, Yahoo! Mail went from No. 3 to leading all competitors by a wide margin, and the company’s instant messaging service rose to become the leader in that market as well. Garlinghouse also oversaw the company’s Flickr photo-sharing service and Yahoo! Groups.

Prior to Yahoo!, Garlinghouse was CEO of Dialpad.com Inc., responsible for all aspects of the company’s operations, finance, sales and marketing. He was also General Partner at @Ventures, Category Manager of Media Development for the @Home Network, Inc., and Manager at SBC Communications.

Garlinghouse, 38, received his BA in economics from the University of Kansas and his MBA from Harvard Business School.

Yahoo confirmed the news–first reported by BoomTown and in The Wall Street Journal last night–that it was buying Xoopit, the San Francisco-based social email company.

And it did so in both a blog post and on Twitter, as you can see here:

@karaswisher @jvascellaro Your scoops confirmed http://bit.ly/gpOT2

Well, thanks! But we are already onto new scoops, so try to keep up!

The price for the acquisition, which Yahoo (YHOO) did not reveal, was about $20 million, according to sources.

In its blog post, titled “Xoopit + Yahoo! Mail = Moving beyond that massive digital shoebox,” Yahoo’s SVP of Application Products Bryan Lamkin wrote, in part:

With the integration of Xoopit’s platform technology and capabilities, the task of sending photos via email will be as easy as it should be and sharing photo albums with friends and family members will also be a cinch. You’ll be able to share your pictures among a group of friends or family like never before–combining pictures from numerous sources into a single album for a private group to view. And soon your inbox will become an organized photo index as well. Just imagine having a tool that collects all the photos you’ve sent and received over the years into that scrapbook you’ve never had time to assemble.

In short, Xoopit will bring phenomenal photo organization, improved photo sharing, and the serendipity of discovering forgotten photos to Yahoo! Mail.

Why is this such a big deal? Yahoo! Mail is actually home to one of the largest online photo repositories in the world. And every day, millions of you use Yahoo! Mail as your primary way to share the photos of important moments in your lives. While social networks and community sites are great for sharing photos with everyone you know, we realize it’s not for everyone or every occasion. For many, email is still best for sharing photos among a more select group of friends or family. And now we’re making it all that much easier for you.

Xoopit finds photos, videos, links and other files in email so that users can surface and then share them on many sites, such as social networking giant Facebook. It also has other products that essentially enliven email.

Xoopit’s investors–Accel Partners and Foundation Capital, along with several angel investors–have pumped about $6.5 million into the company since 2006.

As I previously reported, sources said Yahoo was first impressed with its innovative plug-in that works with Gmail from Google (GOOG), and has been looking at the company for a while, previously offering about $10 million for it.

Xoopit also makes a similar photo-sharing application for Yahoo Mail, which it launched late last year.

The opening up of its popular email product to a variety of third-party applications in order to make it more robust has been a goal of Yahoo recently as it seeks to socialize one of its most popular products.

Interestingly, in the Yahoo blog, Lamkin said Xoopit was Yahoo Mail’s most popular third-party app.

Here is a screen shot of Xoopit in action in Yahoo’s email offering (click on the image to make it larger):

Yahoo plans on announcing Thursday that it has bought Xoopit for a price in the $20 million range, according to several sources, one of its first acquisitions in a long while.

Reached late this afternoon by BoomTown, a Yahoo (YHOO) spokeswoman declined to comment about the acquisition. Xoopit did not respond to emails earlier today.

But sources said it was a done deal to buy the San Francisco-based social email start-up that finds photos, video, links and other files in email so that users can surface and then share them on many sites. It also has other products that essentially enliven email.

Xoopit’s investors–Accel Partners and Foundation Capital, along with several angel investors–have pumped about $6.5 million into the company since 2006.

According to sources, Yahoo was first impressed with its innovative plug-in that works with Gmail from Google (GOOG), and has been looking at the company for a while, previously offering about $10 million for it.

Xoopit also makes a similar photo-sharing application for Yahoo! Mail, which it launched late last year.

The opening up of its popular email product to a variety of third-party applications, in order to make it more robust, has been a goal of Yahoo recently, as it seeks to socialize one of its most popular products.

One source said Xoopit was a good fit for Yahoo because it allowed the company’s email to be the platform that could knit together other social networking services, such as Facebook. This is seen as a core feature, although the Silicon Valley-based company is also opening its email products up to outside developers.

Yahoo has been planning on announcing the acquisition on Thursday at Fortune magazine’s Brainstorm Tech conference, where SVP of Applications Products Bryan Lamkin is appearing on a panel titled, “Dollars & Demographics: Capitalizing on Demographic Trends.”

Lamkin, a former Adobe Systems (ADBE) exec, now runs the Yahoo unit that includes email and other communications and communities products. He was hired in April by CEO Carol Bartz.

That panel topic is a little ironic, several sources joked, since Xoopit is not profitable and has very small revenues thus far.

The Wall Street Journal also reported on the deal, although it said Yahoo and Xoopit were still in late-stage talks and the deal was not complete yet.

But, according to my sources, it is done.

Here’s a video interview I did yesterday at the San Francisco event where Yahoo finally launched a lot of the new open and social elements that it has long said it was injecting into its most popular products.

BoomTown talked with the key movers of the initiatives: Ash Patel, Yahoo’s EVP of its Audience Product Division, and Tapan Bhat, its SVP of its Front Doors, Communities and Network Services.

(You can see screen shots and an official Yahoo video of the new features here.)

The initiatives Yahoo (YHOO) finally released into the wild have been long in the making, first discussed as just vaporware by Yahoo CEO Jerry Yang at last year’s Consumer Electronics Show in Las Vegas (see that video below too).

Yahoo also hosted a session at its Sunnyvale HQ about its open plans in the fall.

And, after the longest of gestation periods, they arrived yesterday, in an impressive rollout.

The changes include some very deft rejiggering of Yahoo Mail, called a “smarter inbox,” with a new dashboard welcome page, easier ways to make connections, more filtered views, updates and third-party apps integrated into the application.

I thought the changes to the mail product were the most interesting, especially given the hundreds of millions of people using the product. It’s an interesting choice for a social entry point, aiming to give nonsocial-networking types enough of a taste of it without inundating them.

Of particular note were the third-party applications, such as for WordPress and Flickr, that launch nicely right in the email program.

Also cool was one app from Xoopit that surfaces old photos and photo links lost in the musty archives of old emails.

Yahoo also debuted an enhanced version of the homepage (previously announced in September) and My Yahoo, as well as a new toolbar and socialization elements added to its popular media properties.

It remains to be seen how popular these changes will become, especially since many consumers already have their social-networking lives on Facebook or MySpace.

In addition, both Time Warner (TWX) online unit AOL and Microsoft (MSFT) have rolled out similar social and open changes to their sites recently, making it super-confusing for everyone.

But, better late than never, I always say, so here’s Bhat and Patel talking about Yahoo’s new stuff.

I had to load the video onto YouTube, as Brightcove had snafus (also below is Yang talking about the concepts at CES in January 2008):

Tapan Bhat and Ash Patel

Jerry Yang at January 2008 CES

(BoomTown interviewed top Yahoo execs Tapan Bhat and Ash Patel about the moves here.)

For a look-see, here is a Yahoo (YHOO) video about the launch and some screenshots of the changes (click on the images to make them larger):

Yahoo’s Official Video on Open and Social Launches

Yahoo Mail Main Page

Yahoo Mail Inbox

Xoopit in Yahoo Mail

Toolbar Notifications

Media Integration in Yahoo TV site

Open Applications

Former Facebook exec Owen Van Natta will take the CEO job at a music discovery site called Playlist, a move that had been speculated last week, after he did not end up taking another position as head of MySpace Music.

Van Natta’s arrival at Playlist was not the only news for the Palo Alto, Calif.-based start-up–former AOL exec Bob Pittman’s Pilot Investment Group is also investing an undisclosed amount of money in Playlist. Pittman will also join its board.

Playlist has previously raised several million dollars, said sources, but the new funding is many times that, to total about $18 to $20 million.

The move to Playlist is an interesting one for Van Natta, who has looked at a number of jobs since leaving the high-profile social-networking site earlier this year.

He has talked to a wide range of companies, sources said, including Microsoft (MSFT) and a range of start-ups, as well as with MySpace, which is owned by News Corp. (NWS). (News Corp. also owns this site).

Those talks between Van Natta and MySpace to run its new music initiative did not pan out for a variety of reasons.

But he has long expressed a desire to become a CEO of a company, rather than just head to another executive job within a larger company, so the move to run a start-up is not a surprise.

In an interview this afternoon, Van Natta told me he got very intrigued by the possibilities at Project Playlist, which was the first iteration of the start-up and in which he is an investor, due to its viral growth.

And, indeed, Playlist has grown quickly to become one of the larger music communities on the Web, claiming that more than 38 million music fans monthly, sharing playlists via its Web site and also widely distributed embeddable widgets. The site has tens of millions of daily page views, according to surveys.

To get to those big-scale numbers, Playlist essentially has offered users a giant linking service for music, not unlike Google (GOOG) with all information, pointing users to promotional, free and sometimes illegal music and music video tracks all over the Web.

Those links to illegal music have resulted in a lawsuit aimed at Playlist from the music industry, sources said, a sadly typical experience of many online music services.

The usual tactic for the music giants: Sue first and shake down later.

Under Van Natta, I would guess, Playlist is likely to reach out to music companies and strike deals.

The company also needs to settle on its main business plan, which appears to me to have been less important than its explosive growth.

Playlist currently does have some small amount of advertising on the site, and seems to be making most of its scratch from sending leads to ringtone sellers.

Van Natta did not want to reveal specific strategies for Playlist going forward, only noting the opportunity is large.

“Discovery around music is exploding on the Internet,” said Van Natta. “And the company that does the best job of taking advantage of that is really going to be huge.”

That said, there have been a lot of music-aimed efforts like Playlist in the music space, with a lot of different business plans and varying degrees of success, ranging from the Apple (AAPL) behemoth iTunes site, which sells single songs, to the CBS (CBS) music service, Last.fm, which relies more on advertising revenues.

Other contenders in the space include the Rhapsody subscription service from RealNetworks (RNWK), music discovery service iLike and many others. MySpace has also waded deeply into the music space, and Facebook is also reportedly weighing its own service.

Van Natta was one of Facebook’s earliest and most prominent execs, serving in jobs like COO and also Chief Revenue Officer while there.

He came to Facebook in the fall of 2005, after a stint as VP of Worldwide Business and Corporate Development at Amazon, and was part of the founding team of A9, the Amazon search company.

“I am excited to be building a company again,” said Van Natta, who has taken many months off since he left Facebook in February.

In its ongoing renovation of its offerings–last month it began rolling out a new homepage–Yahoo is unveiling a new online calendar, with a passel of new bells and whistles, to a small group of users worldwide.

At first, the beta–current users can register to try it here–will take place in the United States, Brazil, India, Taiwan and the United Kingdom.

Overall, it is a good-looking, simple and clean design–that will eventually be extended to all of Yahoo’s 8.1 million calendar users worldwide.

It is also Yahoo’s first attempt at leveraging and integrating technology from its $350 million acquisition of open-source email and calendaring company Zimbra just over a year ago.

And, incredibly, although Yahoo’s is the top online calendar in the world, it has been 10 years since the Internet giant updated it.

That lack of innovation has resulted in major inroads in recent years by newer entrants like Google, whose calendar launched with more modern features, like color-coding, easy sharing and drag-and-drop functionality.

With its renovation, which is based on open standards, the updated calendar from Yahoo (YHOO) now has these kinds of features and also works more seamlessly with Yahoo’s powerful email product, Yahoo! Mail, which has 278 million users.

The new Yahoo calendar is built on the Zimbra platform, which uses Ajax functionality in its online calendars and iCalendar (iCal) and CalDAV3 standards.

That makes it interoperable with other online calendar services, including those from Mozilla, Apple, Microsoft, Time Warner’s AOL and Google.

One of the cooler features is the ability to zoom-in and zoom-out from a monthly wall calendar view to a single event.

In addition, Yahoo’s new calendar can integrate pictures from its Flickr photo community and also has a “to-do” list.

As the beta is rolled out further in the coming months, Yahoo will add additional synching and event discovery features.

I talked about all this today with Yahoo SVP Scott Dietzen, who came to the company with the Zimbra acquisition and now is in charge of all communications products at Yahoo.

Here is the video interview I did with him:

And here are the screenshots of the new calendar, along with one of the old calendar, for comparison (click on images to make them larger):

The old main Yahoo calendar

The new main Yahoo calendar

The “zoom” feature

The integration with Flickr

The Upcoming.org integration

Although about one-third of its user base–30 million people–has already switched over to its new design, which has been opt-in since July, Facebook will now officially start to move the entire site and the other 70 million Facebookers.

The changeover–which is not optional–will be complete in a few weeks, Facebook said.

I do like the new look, which is definitely cleaner and simpler, although it makes the experience a little more disjointed, since everyone’s profile is now cut up into tabs.

But it is nice to be able to better customize your information via those tabs, and it is easier to navigate (although search on Facebook still stinks, and BoomTown actually looks forward to Microsoft’s attempt to tame this savage beast).

Of course, there have been a lot of complaints from users, and there is even a popular “I Hate the New Facebook” group on the site (natch!).

And not all third-party application developers like it either, including new navigational changes that limit instant user access to as many applications as before.

But that’s life in Zucker-berg!

Over at AOL, a division of Time Warner (TWX), there has also been some primping going on, which includes an interesting integration of popular third-party emails.

Now it is easy to add access to non-AOL email accounts, such as GMail and Yahoo! Mail, which sit right next to AOL Mail at the top of its main AOL home page. (See the image above and click on it to make it larger.)

Other changes are coming soon, all part of AOL’s laudable attempt at openness, to keep its Web site as relevant as possible.

Not that it has a choice. Back in its glory days, AOL was the emperor of the walled garden strategy, which kept users inside well-tended online paths and out of the wilds of the Internet at large.

Which, if you think about it, seems as quaint as the faux political nostalgia around small-town life these days.

But, since you apparently can’t put lipstick on a pig (or a pit bull either!), Green Acres is no longer the place to be in real life or on the Web.

Yesterday, BoomTown wrote a piece about Yahoo’s worries about the scrutiny that the monopolistic combination of Yahoo Mail and Microsoft’s Hotmail would get if it merged with the software giant.

The issue–which has not gotten a lot of attention–is actually a major sticking point in the price negotiations going on this weekend between the companies, as Yahoo (YHOO) seeks solid downside protection, if the deal becomes mired in approval issues by governmental authorities due to email and instant messaging dominance on the Web.

But Microsoft (MSFT) does not want to pay more, of course. And so the legions of minions under increasingly-under-pressure–translation: more yelling than ever this week–CEO Steve Ballmer are hard at work this weekend on all-nighters to solve the problem, said several sources.

One solution is to spin off all the communications assets, said sources, into a separate company. In that case, the two brands would remain, so as not to inconvenience consumers, although all the back-end technologies to run the services would be merged.

The more drastic step is for Microsoft sell Hotmail to a third party, especially given that Yahoo Mail is considered a stronger brand. Hotmail has already been in the midst of a transition, including a recent name change to Windows Live Hotmail.

Microsoft’s mail offerings now include Hotmail and also Windows Live Mail. The latter offering would presumably remain at the merged company with its @live.com address.

But Hotmail is the candidate to be sold off (with the requisite marketing to try to port its users over to @live.com first).

And potential buyers? Well, not Google (GOOG), but there are many, including AOL (TWX), Comcast (CMCSA) and AT&T (T), as well as IAC/InterActiveCorp (IACI). As to price, that’s unclear, but it could be in the billions of dollars.

That’s another plus for Microsoft, which will obviously have to fork over more money if it wants to acquire Yahoo.

And, it is also priceless if Microsoft can minimize government interference in the deal, most especially any antitrust investigations related to its powerful email assets.

That must be a worry, since Microsoft and Yahoo completely dominate all email on the Internet. According to the most recent comScore (SCOR) figures, for example, Yahoo has 256 million users, while Microsoft has 255 million.

Google’s Gmail is a distant third with about 92 million users and AOL has about half that at 49 million.

The same domination is true in the instant messaging market, with Microsoft and Yahoo holding an 80% to 90% market share together.

Please see this disclosure related to me and Google.

Let’s move this back-and-forth- wrangling aspect of the story forward and get to the real issues in the Yahoo-Microsoft takeover battle, shall we?

So why is Yahoo’s board holding out for a higher price than Microsoft wants to offer to raise it?

From numerous reports, Microsoft (MSFT) seems willing to go to $33 a share, up from its original $31, while Yahoo (YHOO) and its shareholders are looking for from $35 to $37.

Are they simply looking for a bigger payday? Do they believe it is worth more, in spite of recent mismanagement? Do they want to save face, given the Internet company once had a $41 offer from the software giant? Is this just a big game of digital chicken?

Yes. Yes. Yes. And definitely.

But, according to sources close to Yahoo, one of the more important reasons Yahoo wants a higher price has a lot to do with worries about the domination of the email and communications market if a merger with Microsoft took place and the threat of regulatory action that would force the companies to divest those assets.

Sources said that Yahoo wants a large cushion in case the government finds the combination of Yahoo Mail and Hotmail too much.

It is.

That’s because Microsoft and Yahoo completely dominate all mail on the Internet. According to the most recent comScore (SCOR) figures, for example, Yahoo has 256 million users, while Microsoft has 255 million.

Google’s (GOOG) Gmail is a distant third with about 92 million users and AOL (TWX)–which kind of started off the whole email craze among consumers–has about half that at 49 million.

The same is true in the instant messaging market, with Microsoft and Yahoo holding an 80% to 90% market share together.

Calling David Boies! It all smells like antitrust investigation to me!

A high-ranking Yahoo source agrees. “We need a lot of reason to do the deal, because it could be very bumpy once we agree,” said the source. “How damaged would Yahoo be if it did not go through, or if important pieces of Yahoo had to be separated from the company?”

Some close to the company, though, would prefer a spinoff of its powerful communications products and services, in the case of a Yahoo-Microsoft union. “We could be the Google of communications,” said one source.

Of course, Google does not want this to happen. In a recent CNBC interview, Google CEO Eric Schmidt signaled the search giant’s intentions related to this thorny communications domination with a loaded quote:

“If they go ahead and the merger’s ultimately successful, it would be possible for Microsoft to integrate some of the properties and essentially eliminate consumer choice, particularly in electronic mail, instant messaging, the things where they have 80% or 90% market share, and that’s a sweet spot for Microsoft in its ability to eliminate choice.”

And, in fact, Yahoo CEO Jerry Yang and Chairman Roy Bostock raised the issue in a letter on April 7 to Microsoft, rejecting Microsoft CEO Steve Ballmer’s letter threatening to go hostile if talks did not proceed.

The Yahoo leaders wrote:

“As to antitrust, we have discussed with you our concerns. Any transaction between us would result in a thorough regulatory review in multiple jurisdictions. As a follow-up to a recent meeting among our respective legal advisers we had on this topic, and at your request, we provided to you on March 28 a list of additional information we would need to further our understanding of the regulatory issues associated with any transaction. To date, you have still not provided any of the requested information.”

According to one source, the antitrust concern that was not named was related entirely to email and instant messaging.

“Bring together our content and search is not an issue,” said the source. “But mail is a real problem.”

Please see this disclosure related to me and Google.