Microsoft, Yahoo join forces to challenge Google

Microsoft, Yahoo join forces to challenge Google

Thursday, 30 July 2009, 03:26 Hrs   |    14 Comments
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Washington: Tech giants Microsoft and Yahoo reached a long-awaited partnership on Wednesday in a bid to challenge Google, which holds a 65 percent market share in online search. The two companies have plenty of challenges now, but the ground rules have been set: Yahoo's job is to be an online hub, and Microsoft's job is to out-Google Google.

Under a 10-year deal, websites from both companies would use Microsoft's Bing search engine, which could now integrate Yahoo's considerable trove of search technology.

Yahoo, in turn, would handle worldwide sales of premium search-related advertising for both companies.

In exchange for becoming Yahoo's sole search provider - and gaining access to its massive traffic - Microsoft would pay its partner 88 percent of the search revenues generated on Yahoo sites.

"This agreement comes with boatloads of value for Yahoo, our users and the industry, and I believe it establishes the foundation for a new era of Internet innovation and development," said Yahoo chief executive Carol Bartz in a statement.

According to Microsoft chief executive Steve Ballmer, the deal will allow Microsoft to "create more innovation in search, better value for advertisers and real consumer choice in a market currently dominated by a single company".

And in a dig against online search market leader Google, the companies said in a joint statement that "advertisers no longer have to rely on one company that dominates more than 70 percent of all search".

A Yahoo-Microsoft partnership would mean about 28 percent of Internet searches would be performed on their combined platform, according to figures from ratings firm ComScore.

That would still be less than half of the about 65 percent market share of Google Inc., which has long dominated the search space.

Last year, Microsoft attempted to buy Yahoo for more than $45 billion, an unsolicited bid Yahoo rejected, but the Redmond, Washington-based software giant has long had Yahoo's search business at the top of its wish list, and the two had reportedly been in discussions for months.

Yahoo estimated the deal would add $500 million to its annual operating profit, as well as saving it around $275 million in expenses related to developing and maintaining its own search technology.
Source: IANS
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Reader's comments(14)
1: I tell Bill Gates what Michael Dell said when he was asked what he'd do if he were CEO of Apple Computer: "I'd shut it up and give the shareholders their money." The world has had enough of the lousy Microsoft. MS makes me puke. This deal shows that since MS just doesn't have the firepower to beat Google in Technology, it'll fall to any lows to command its presence. Boo, Mr. Ballmer!
Posted by:Abhishek G Nair - 02 Aug, 2009
2: Yahoo & Microsoft have come together to beat google, but they do not understand the competition in the internet space in spite of the fact being both are innovators of technology as Google and all of them came from nowhere. This is stupidity, instead of creating another new technology and dominating the newly created market they are foolishly thinking of beating google. Who knows Google might be beaten by some new technology by some new company.
Posted by:Shafique Ansari - 30 Jul, 2009
3: It is not at all possible to cross the GOOGLE even if the microsoft combines with few more popular search engines in the world..because the GOOGLE is ever green and nobody can reach to GOOGLe
Posted by:Bangaram - 30 Jul, 2009
4: Google is market leader so its not a easy task to grab their market by any means ..................
Posted by:Saanaa - 30 Jul, 2009
5: google and apple may be good in innovation.
but microsoft is best at its business.
they changed the way we live today.
they will. Example is the OS that u hav logged in now.
Posted by:Babu C K - 30 Jul, 2009
:P m on Ubuntu
Ubuntu Replied to: Babu C K - 30 Jul, 2009
7: Microsoft.........trying to acquire almost every business......Not a good policy. Instead they can spend time in doing some thing new
Posted by:krishna - 29 Jul, 2009
Exactly ... after the failure of windows vista they got it in a better way .. still windows 7 is in trial period ..dont know what they r doing
Partha Replied to: krishna - 29 Jul, 2009
9: nothing is impossible... dude
Posted by:lesnar - 29 Jul, 2009
10: Google is a market leader ..and i dont think it would be very easy for yahoo and microsoft to take the market so easily ..
Posted by:Partha - 29 Jul, 2009
yes of course...No way... they can't crack google...wait till chrome Os release...we can see` the change... from MS Os
srinivas Replied to: Partha - 30 Jul, 2009
Seems like Srinivas is created Chrome OS and Partha is working for Google to develop search engine ... No one can predict anything .... Guys dont forget the fact that u were using microsoft product more often.
Mark Tyson Replied to: srinivas - 30 Jul, 2009
I open google page more than the number of times I log in to my windows box... And the very first page I open after getting to any servers I work on is Google...
By the time MS & Yahoo together try to reach half of Google's Market share, Google will come out with an OS to beat Microsoft's :P
RaRaRa Replied to: Mark Tyson - 03 Aug, 2009
I strongly feel that this merger is for good.

There has not been any improvement in the way topics and things are searched over the net and the results are provide.
I would say only 50% are the relevant results (results of interest). It is because the most of the serch engine market is taken by google and they were till now sitting and doing nothing or very little to improve the user friebdly reults.

Now that Yaho and Microsoft have joined hands, there is a possibility of improved search results as well as chances of new innovations from either ends (MS+ yahoo or Google).

More over the trend in coming years would be the convergence, so I feel coming together for these Technology leaders would be good for everyone.

This is my sole interpretation..and it differs :)
Himanshu Parihar Replied to: RaRaRa - 11 Aug, 2009