It seems like years since these two giants starting talking. Wait, it has been years. Three long years to finally consumate terms of an agreement to share resources and tackle the market together.
Pity it took so long. I wonder what Wall Street thinks of this? A quick peek shows that Yahoo is down 10% this morning and MS is holding tight.
Allow me to give you a snippet of the press release from Microsoft:
Yahoo! and Microsoft announced an agreement that will improve the Web search experience for users and advertisers, and deliver sustained innovation to the industry. In simple terms, Microsoft will now power Yahoo! search while Yahoo! will become the exclusive worldwide relationship sales force for both companies’ premium search advertisers.
So here are the basic details:
— Yahoo will not receive an upfront payment
— Ten year deal
— Bing will become the default search engine on Yahoo, according to AdAge. Bing therefore would be able to claim 28 percent of the search advertising market, according to the latest comScore figures.
— Yahoo’s search engine will use the Bing brand
— Yahoo will “take on exclusive representation of Bing inventory”
— The WSJ says that Yahoo will also sell ads on some other unspecified Microsoft sites
— Microsoft’s AdCenter platform, however, will be the underlying sales technology platform
— The companies expect some interest from the Justice Department, which was reportedly an earlier sticking point for Yahoo’s board
— Microsoft may ask for the Justice Department’s approval, before going forward with the deal. The Justice Department, of course, did not okay Yahoo’s search advertising partnership with Google last autumn.
Does Google now have legitimate competition? Time will tell.
