Microsoft And Yahoo Seal The Deal

Microsoft and Yahoo have announced that they've reached a deal on search.

It’s been well over a week since reports came out that Microsoft and Yahoo were very close to a search deal. Since then there’s been very little said.

But now the companies have announced that the deal is done and signed, ending more than a year an a half of on-again, off-again dancing. It’s set to last for 10 years, Microsoft head Steve Ballmer said:

"Through this agreement with Yahoo, we will create more innovation in search, better value for advertisers, and real consumer choice in a market currently dominated by a single company."

Microsoft will take care of search queries via Bing, both on its own and Yahoo sites. In return, Yahoo will keep 88% of the revenue from all search ad sales on its site for the first five years of the deal, and have the right to sell adverts on some Microsoft sites. Yahoo chief executive Carol Bartz enthused:

"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."

Bing owns about 8% of the search market, and Yahoo 20%, according to the most recent figures. But they lag far behind Google, which has a very dominant 65% of the market.