Analyst Trip Chowdhry of Global Equities Research thinks Microsoft’s $45 billion dollar bid for Yahoo is simply a tactic to stop Yahoo from merging with Amazon. In his mind, Microsoft knows that Yahoo couldn’t turn down such an offer to go with a lesser one from Amazon, and if Yahoo accepts, the government will stop the deal from going through – so it’s a win-win for Microsoft, stopping an acquisition while spending no money. Except that very little of that actually makes sense.

First of all, I could see this tactic maybe (and that’s a big maybe) if Google or Apple – Microsoft’s main rivals – were trying to buy Yahoo, but I’m not sure that they would necessarily care if Amazon wanted to (which is also questionable by the way). A $45 billion dollar bluff seems like a bit much – even for Microsoft – especially when you consider that nearly every other analyst and expert on the matter (besides Chowdhry) thinks a Microsoft-Yahoo deal would go through.

Chowdhry’s main arguments as to why the deal would be struck down all seem to be based on Microsoft’s reputation for monopolistic practices in the 1990s, but this is a different ball game. Microsoft and Yahoo are both far behind Google in Search and Online Advertising – arguably the two key components in the market. While the EU would very likely give Microsoft a hard time, the U.S. government would likely look into the matter and let it go through – how does a $45 billion dollar gamble look at that point? Risky. Too risky.

Another problem with this argument is that while the $45 billion was impressive, it’s probably still undervaluing Yahoo – so it’s not like this was the complete end-all deal. As recent as October, Yahoo’s stock was near $34 a share. When Microsoft made the bid, Yahoo was at $19 (around its 4-year low), and so Microsoft’s bid was $31. This means that 3 months ago such a bid would have been an insult – I know that Yahoo is off track, but not that much has changed in 3 months; Microsoft is clearly trying to get a very good deal – is that not motive enough?

Most important in all of this is that Microsoft has laid out a very compelling case for why they need Yahoo – and why such a deal makes sense. On many levels it does make sense, it is very clear now that neither company can compete on its own in the aforementioned search and online advertising markets with Google. #2 and #3 (Yahoo and Microsoft) combined would still not be close to #1 (Google), but they would certainly be closer and in a better position to compete.

If there is one thing we know about Microsoft it’s that they want to compete – in everything. So a $45 billion dollar bluff just to annoy Amazon – who could, by the way, make another go at Yahoo after the FTC strikes down MSFT/YHOO under Chowdhry’s scenario – doesn’t make a lot of sense. How does a bluff get them any closer to competing with Google? It doesn’t. But buying Yahoo does.