Microsoft/Yahoo Announce 10 Year Partnership Deal
Ending years of negotiation and speculation, Microsoft and Yahoo have finally announced that they will join forces in a move that is largely seen as an attempt to reclaim some of the huge search engine market share currently held by Google.
According to the terms of the agreement, Yahoo will use Microsoft’s new search engine, Bing, on it’s websites, while Yahoo will concentrate on search advertising sales for both companies.
The move has been hailed by some commentators as finally putting a real contender into the search engine competition again, after years of Google domination in the fields of pure and paid search.
This domination has made it difficult for either of the competitors to gain market share, but the agreement will now give Microsoft and Yahoo a combined share of 28% in the US search engine stakes, against Google’s approximate 65% share.
Not everybody is sure that it’s going to make much difference though.
What’s Changed?
Carl Howe of the Yankee Group said, “the amazing thing about this deal is how little impact it has. Search rankings won’t change, advertising rates will continue in a downward spiral and the regulatory hassles involved will benefit the very beast they’re hoping to bring down: Google.”
It’s generally believed that Microsoft, who has been trying to implement a deal with Yahoo for years, even attempting to buy it outright in the past, will be the greatest beneficiary of this deal. And it’s biggest gain, according to a recent report, will be the greater scale in search it will receive.
Time Will Tell
To really win big though, the challenge remains the same as it has always been. To contest, and even overturn, Google’s number one spot. A spot that has turned the name of their search engine into a verb. And that will be some challenge.
While this move shores up Microsoft’s efforts, it remains to be seen if Bing can truly challenge Google, let alone displace them altogether.
The stock market however, did not appear to respond in favour of the announcement once it happened.
Yahoo shares dropped 12.08% on Wall Street, closing at $15.14, while Microsoft shares rose 1.41% to finish at $23.80.
Google, on the other hand, lost 0.82% to close at $436.24 per share.
