It was much anticipated and then anti-climactic – Microsoft and Yahoo are to partner in the search sector to compete with Google. Microsoft will focus on organic search, Yahoo will focus on paid search. Each will continue to compete rigorously in other areas. Since the announcement of the deal, Yahoo stock has been sliding, surprising considering the many other very important web properties they own.
As a digital marketer employing organic and paid search marketing strategies, there are some key points in this deal to consider as the Microsoft Bing decision engine technology will now be used on Yahoo sites.
• Microsoft will acquire an exclusive 10 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;
• Microsoft’s Bing will be the exclusive algorithmic search and paid search platform for Yahoo! sites. Yahoo! will continue to use its technology and data in other areas of its business such as enhancing display advertising technology.
• Yahoo! will become the exclusive worldwide relationship sales force for both companies’ premium search advertisers. Self-serve advertising for both companies will be fulfilled by Microsoft’s AdCenter platform, and prices for all search ads will continue to be set by AdCenter’s automated auction process.
• Each company will maintain its own separate display advertising business and sales force.
• Yahoo! will innovate and “own” the user experience on Yahoo! properties, including the user experience for search, even though it will be powered by Microsoft technology.
• Yahoo! will continue to syndicate its existing search affiliate partnerships.
It has now become even easier to optimize for all major search engines – there will only be two and opportunities do increase with the growth of the user base. So marketers will likely start paying more attention to the Yahoo/Microsoft offering. On, the other hand, many web users will be tempted to migrate to Google following this deal if Yahoo is not effective enough in branding their Bing search engine results. If it looks too much like Microsoft while they are on a Yahoo site this might cause some confusion and discomfort, they just might switch to Google. After all they use Yahoo and not Bing for a reason.
This will be a topic to watch over the next year as they are scrutinized in order to satisfy anti-trust laws, though more likely this deal will be viewed as fostering competition as search has been clearly already dominated by Google. But what Google really needs to worry about is that new best thing someone is working on in their basement with their friends with no budget. Microsoft and Yahoo both have other things going for them and should stop worrying so much about search, it’s getting in the way.
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