Thursday, July 30, 2009

Microsoft and Yahoo! to collaborate again Google

Finally Microsoft has achieved its target, or nearly...The deal that has been signed between Microsoft and Yahoo caps more than two years of effort by Microsoft to get hold of Yahoo's search business in an effort to become a serious challenger to Google. Although less drastic than the $48bn bid for the acquisition of Yahoo that Microsoft had proposed last year, the move would be still be a very expensive one for Microsoft and it will not an easy one to implement but could help Microsoft to become a credible rival for Google.

Microsoft and Yahoo! have announced a ten-year revenue-share search pact. Microsoft's Bing will now power Yahoo! search while Yahoo! will become the exclusive worldwide relationship sales force for both companies' search advertisers.

Microsoft announced that the agreement will provide it's search engine (Bing) with the scale necessary to attract more advertising revenue and increase the visibility of the brand. This will enable it to compete more effectively with Google in an attempt to come out from a defensive strategy to a more aggressive competing strategy.

Microsoft will acquire an exclusive ten-year license to Yahoo!'s core search technologies, and Microsoft will have the ability to integrate Yahoo! search technologies into its existing web search platforms.

Should this deal pass antitrust scrutiny, do you think this relationship will be a successful one? Do you think Yahoo! and Microsoft will be a real threat for Google?

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