It’s already been more than a year since Microsoft’s deal to outright acquire Yahoo…. Now, the focus is on Microsoft’s new search engine – Bing – becoming the search provider on Yahoo.com, which would combine to give the companies a more formidable rival to Google (Google), at least in terms of market share and ad inventory. AdAge reports that a deal “is likely to be announced this week” that would give Microsoft roughly 30 percent share of the online search market.
How does it work? Here is the structure:
“Yahoo would be allowed to sell search ads on Bing.com as well as its own site, giving it more search inventory to sell and making it a bigger player in the search sales front. It would also immediately be able to save millions by not having to maintain its own search infrastructure. The latest terms of the deal underscore Microsoft’s devotion to developing and owning technology vs. selling media.”
For Microsoft, though, the struggle against Google becomes more intense. The combined search market share of Yahoo and Microsoft still is half what Google has, and the fact that Wednesday’s Yahoo pact is smaller in scope than some earlier possible incarnations means Microsoft has that much more hard work before it.
The company clearly wants to make a third big business out of its online operations to complement its Windows and Office cash cows. Getting Yahoo’s search technology and Web site traffic gives it a better stronghold but by no means a victory.
Here are some FAQ’s about the deal:
– Self-serve advertising for both companies will go through Microsoft’s AdCenter platform.
– Microsoft’s BingBingBing will now be the search engine on all Yahoo sites.
– Yahoo will provide the relationship sales force for both companies’ premium search advertisers.
– Each company will maintain its own separate display advertising business.
– Microsoft will compensate Yahoo through a revenue sharing agreement on traffic generated on Yahoo’s network.
– The term of the agreement is 10 years.
All the best microhoo :) is all I got to say!!
