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BizReport : Search Marketing : June 13, 2008

Yahoo: Goodbye Microsoft, Hello Google

Yahoo has finally given Microsoft the heave-ho and before the phone had a chance to cool has entered into a partnership with arch rival Google.

by Helen Leggatt

The non-exclusive search advertising partnership is expected to generate as much as $800 million in annual revenues. It comes hot on the heels of Yahoo’s rejection of Microsoft’s advances earlier this year. Successful testing of their partnership in April seems to have paved the way for Thursday's announcement.

Details of the deal which appears, to all intents and purposes, to simply make Yahoo a reseller of Google ads, include:

- It only covers paid search and contextual ads, algorithmic search is excluded.

- Yahoo will display paid search results from Google, other third parties and Panama ads alongside each other.

- An initial term of four years with an option for Yahoo to extend for a further six years.

- Only applies in the U.S. and Canada.

Commenting on the deal, and after referencing today’s decision about Microsoft, Jerry Yang is reported as saying, “Clearly it is time to move on. We believe this agreement with Google helps us to do so by strengthening our competitive position and generating attractive financial benefits.”

Tags: Google, Microsoft, search advertising, search marketing, Yahoo

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  • Look for PPC rate increases in both Google AdWords and Yahoo Search as a result of this new search advertising agreement.



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