Valleywag has the scoop that UStream.tv is said to be in late-stage discussions with none other than Microsoft about selling their service for over $50 million dollars. Other companies are said to be in the bidding as well.

While on the surface such a deal might make sense, UStream.tv is a popular lifecasting site, video is all the rage these days, and $50 million is chump change for a Microsoft that doesn’t seem to blink unless it’s a deal involving billions with a ‘b’. But lets look at one of the other hot stories from a few hours ago: Yahoo launching Yahoo! Live, their own lifestreaming service – which they clearly put a lot of effort into.

If Microsoft is confident that Yahoo is going to be accepting their bid as early as tomorrow to buy them out, couldn’t they just use this new Yahoo! Live that they will have paid – you know, $40+ billion dollars for?

Maybe they noticed all the overload problems Yahoo! Live was having tonight and UStream.tv is a wedding present of sorts to them?

It’s a bit odd. If you’re buying a big house with a brand new refrigerator that was just installed, do you buy another refrigerator?