Microsoft and Yahoo Finally Strike A Search Engine Deal

It’s been nearly two years in the making, and Yahoo have gone through a CEO and have had their shares suffer horribly, but finally Yahoo have been able to come to some sort of agreement with Microsoft in their attempts to fight of the growing global power of Google.

Having said that it’s not so much of a combination of resources as a shifting of them towards Microsoft’s pride and joy (and admittedly fairy impressive) Bing – Yahoo will move their searches to Microsoft and they will concentrate on the sales of ‘billboard style advertising’ to attract people towards their already fairly popular sites.

In terms of plain popularity this should really raise Bing’s profile and usage even more: assuming that all of Yahoo’s previous users go Microsoft then it’s market percentage should triple to a respectable 28%, but that is still worryingly insignificant compared to Google’s 60% (according to comScore Inc, these figures do fluctuate depending on who you listen to but these represent a good middle ground).

However this figure could well grow as more people start to hear about it and numbers grow, and it is still possible that it could, sometime in the future, start to become a more potent threat to Google especially as many people are starting to move away from Google towards Bing as they believe it is a lot better in numerous aspects.

But as happy news as this may be to the companies themselves is hasn’t reflected in the stock market – although Microsoft’s shares rose slightly (a massive 33 cents) to $23.80, Yahoo’s plunged 12% (or $2.08) to $15.14, which although may disappoint some shareholders they won’t be nearly as put out as last year when share prices plummeted after the breakdown of the proposed Microsoft takeover (which if you remember eventually resulted in Jerry Yang [chief Yahoo] resigning).

In fact looking at share price changes alone you can see not only how much bigger Google is as a search-engine-force but also that it does actually have an impact on them: their shares fell a significant $3.61, but only to $436.24.

Those figures are quite a sound reflection of how Yahoo has been struggling recently (despite the return of the butler on Ask.com), something also shown in the fact that Microsoft haven’t paid Yahoo any money up front rather they are going to give Yahoo 88% of the search ad sales made on its web site – which is more than the 70-80% normally offered.

But more than anything else it is good to see this fiasco over and no-one seems more glad than Microsoft’s CEO Steve Ballmer who was more than happy to express his feelings:

“I am very enthusiastic…this is what I have basically been saying for the past 18 months: The world will be better served for consumers, advertisers and publishers, and there will be more competition for Google, if we can somehow figure out how to get Microsoft and Yahoo together in search.”

So a happy ending for all (with the possible exception of Google) and finally this story, which seems to have dragged on for a length comparable with that of the Pirate Bay Four, can be put to rest.

Via – Electric Pig

Related Pages:

1. Bing Search Engine More Popular Than Yahoo?
2. Microsoft and Yahoo In Talks…Again!
3. Google To Lose Murdoch’s Newspapers To Microsoft’s Bing Search Engine?
4. Bing TV Advert
5. Yahoo Fulfils Grim Promise to 1,500

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