Microsoft and Yahoo Finalize Partial Merger

A deal that will see Microsoft’s Bing search engine website deliver results for queries from Yahoo’s search portal website has been completed, according to the two companies, but regulatory approval in the U.S. and EU is still pending.

SUNNYVALE, Calif. & REDMOND, Wash., Dec 04, 2009, Yahoo! Inc. and Microsoft Corporation today announced that the companies have finalized and executed the definitive Search and Advertising Services and Sales Agreement and License Agreement in accordance with the letter agreement announced in July.

The companies released the following joint statement:

“Microsoft and Yahoo! believe that this deal will create a sustainable and more compelling alternative in search that can provide consumers, advertisers and publishers real choice, better value, and more innovation.

“Yahoo! and Microsoft welcome the broad support the deal has received from key players in the advertising industry and remain hopeful that the closing of the transaction can occur in early 2010.”

The 10-year deal would see Yahoo keep the lion’s share of profits from search marketers on the Yahoo website, 88 percent over the first five years and 93 percent for the remainder. The companies said that “this deal will create a sustainable and more compelling alternative in search that can provide consumers, advertisers and publishers real choice, better value, and more innovation.”

While industry groups are strongly in favor of the proposed merger going forward, the U.S. Department of Justice is still scrutinizing the deal for possible anti-trust concerns.

Search engine optimization (SEO) professionals have been following the merger closely, and experts say that it would create much stronger competition for current market leader Google than either Bing or Yahoo could individually provide. Although Google maintains a 70 percent market share, Bing and Yahoo in combination could dominate the remaining 30 percent.

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