Mark,
AOL and Netscapre merged in about 1998, I believe, and this made them MS's biggest rival and competitor.
The rumours of the merger between AOL and MS were rampant, and the subject of many hoax e-mails.
I don't remember all the ins-and-outs of the continuing arguments between MS and AOL but they were obliged in 2000/2001 to undergo some 'bundling' of their joint products, but seemingly failed to ever come to an agreement.