free html hit counter Yahoo and Microsoft Announce Deal - John Battelle's Search Blog

Yahoo and Microsoft Announce Deal

By - July 29, 2009

NYT has a good story:

The terms of the 10-year agreement call for Microsoft to license some of Yahoo’s search technologies, and Yahoo will initially receive a lucrative 88 percent of search-generated ad revenue from Yahoo sites.

Cnet does as well. Many folks are noting Yahoo’s shares slide at the open this morning. No “Boatload” of cash upfront…

More as morning coffee kicks in.

Update: YHOO is down nearly 10%, Wall St. no likey. Given the deal was already priced in, that’s interesting. MSFT is slightly up.

The formal statement is here. A marketing website called “ChoiceValueInnovation” is now up too. Really.

Update 2: I am trying to slate some time to talk with the principals involved, if I do, I’ll write it up here later. In short, though, watch two things: 1/How yahoo plans to “own” the UI on top of Bing – given Bing’s UI is key to its differentiation, and 2/Who owns the data and how is it getting used to leverage competing display advertising platforms….

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15 thoughts on “Yahoo and Microsoft Announce Deal

  1. polishrocket says:

    Do we know anything about mobile? Will Bing mobile be powering search for Yahoo mobile?

  2. James says:

    It took 2+ years for this deal? Are you kidding me?

    This MSFT-YHOO thing is really just another (but very big) BD/rev share/re-seller-type deal that is all too common in the tech/media space. And, from what I’ve seen, these almost never work.

    Prediction: The revenue the 2 cos. share will be disappointing and the threat they mount to Google will be insignificant.

  3. preetam mukherjee says:

    do you have ANY idea what those 3 photos on are supposed to represent?

    i mean, i get the whole ethnic diversity thing, but how do they relate to choice, value and innovation?!

  4. Chris says:

    Testing comments.

  5. sevişme says:

    Rev share/re-seller-type deal that is all too common in the tech/media space. And, from what I’ve seen, these almost never work.

  6. What we have here is a rehash of early Yahoo! tactics: partnering with other search engines to power their portal. Clearly, Microsoft is hoping to gain the boost that Altavista and Google originally enjoyed from powering Yahoo!’s Web search results.

    Of course, back then Yahoo! was the dominant player in the search field. Today they are the third in a field of almost four.

    Ballmer appears to believe that by consolidating the networks he’ll be able to draw in more advertisers, whose bidding will drive up traffic acquisition costs on both networks. That’s hardly the incentive I would want to be offered to move advertising over there.

    And consumers are losing one of three unique sources of Web search results. The algorithms are not identical, so now Web search will be narrowed to Google search results (served through Google and other portals), Bing search results (served through Bing and other portals), and occasionally Ask search results.

    This is about as classic an antitrust situation as we’ve ever seen in the Web search industry.

    Everyone stands to lose from this deal.

  7. John, will be eager to here what the principals say. I personally think this deal is not that big a deal. SMBs won’t use two search platforms. Agencies will run buys along party lines but won’t overallocate to Yahoo (you never get fired for buying Google). Ergo, status quo remains. A longer take on my take here.

  8. Andy says:

    I’m curious – What is the impact of this deal on the Yahoo BOSS program? I imagine there are quite a few web sites relying on the Yahoo search service APIs, and I’m sure they’d like to know if Yahoo plans on shutting that service down…

  9. There are quite a few people who are asking what the impact will be on Yahoo! developer tools and services like Search Monkey, BOSS, Pipes, etc.

    Yahoo! has been shutting down or selling Web properties right and left. Say good-bye to Geocities, for example.

    For a company that doesn’t focus on search, Carol Bartz’ Yahoo! seems to have put search in the center ring of its circus in the most undesirable way.

  10. Dustin says:

    How does this deal affect localized search? Bing already has some issues with localized search and I am curious how Yahoo will help Bing? How does this affect Google?

    Will this also encourage trial uses for Bing and steer people away from Google?

  11. I totally agree with banzaibill, Ms. Bartz came in “swinging” and banging her chest and -now-has been humbled by what “she” thinks is the greatest deal of the century for Yahoo…………..this deal was instrumented by Ballmer and Co.

    Note to Ms.Bartz, Probably the shrewdest and smartest deal of all time was screwed up by Jerry Yang ages ago, so get back on your boat and go home……

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  13. hiphop says:

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