Microsoft and Yahoo! just signed a 10 year agreement which will result in Microsoft exclusively powering Yahoo! search. Microsoft has launched a microsite with more information here. Live blogging coverage of Microsoft Yahoo! Press Conference here. The aim is to gain both user support and advertising dollars by providing a more complete search experience.  Here are some key terms of the agreement:
  • Microsoft's Bing will be the exclusive algorithmic search and paid search platform for Yahoo! sites.
  • Each company will maintain its own separate display advertising business and sales force.
For advertisers and agencies this new deal is good news in terms of choice, value, and innovation:
  • Combining the Microsoft Bing platform with the Yahoo service reps will (hopefully) take the best offerings from each company.
  • Aggregating will give advertisers and agencies more data and metrics to use in creating projections and models to improve performance for both networks.
  • It also potentially removes the need to focus on optimizing websites for organic Yahoo! rankings.(Since Bing will also be powering the organic search engine listings for Yahoo! going forward)
For users, there are a few negatives:
  • Fewer choices to search and find information online  (1.Google, 2. Bing 3.???)
  • Less value from search results (with only two major players)
  • Less innovation (competition)
If nothing else, this should be an interesting 10 year relationship.