free html hit counter Search Deal Back on the Table - John Battelle's Search Blog

Search Deal Back on the Table

By - November 19, 2008

SEL reports on a Journal piece:

The search collaboration that Ballmer referred to would presumably be similar to the search (as opposed to acquisition) deal previously offered to Yahoo — essentially to have Yahoo outsource search and SEM to Microsoft in exchange for guaranteed revenues over a several year period. Danny did a detailed post on the prior Microsoft search offer to Yahoo (compared with the now defunct Google deal).

That offer, as with the larger acquisition offer itself, was previously rejected by Yahoo as undervaluing the business. It was also rejected because it was seen by Yahoo as removing a strategic component of the company’s larger suite of advertising capabilities.

Circumstances have dramatically changed since Yahoo rejected Microsoft’s offer.

I have believed in a deal like this for a long time. I think it may well come to pass now. But I think the key is how to integrate the two offerings (Yahoo’s is generally seen as more battle tested and robust, and has a far longer history of monetization) and how to tie both companies’ massive traffic to the engine.

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One thought on “Search Deal Back on the Table

  1. MSFT has so much cash and can do so much… Tons of opportunities out there this time around. I don’t know if Yahoo will be beating down their door or if they are seriously interested — hopefully they are because their current options aren’t looking too good. I just hope they stop screwing up and get on the right track, with some fresh new faces and back to the basics.