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Yahoo!-Microsoft Union Gets Regulatory Thumbs Up

Written on
Feb 19, 2010 
Author
Gavin Dunaway  |
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Yahoo!-Microsoft Union Gets Regulatory Thumbs Up

thumbs_small.jpgADOTAS – After so many months of planning and worrying and fingernails chewed to the nub, the moment has finally come: the U.S. Department of Justice and the European Commission approved the Microsoft-Yahoo! search deal.

Let’s uncork the champagne!

Microsoft and Yahoo! can now implement the search deal, which makes Bing the default algorithmic and paid search provider on Yahoo! sites for the next 10 years, first announced in July 2009. However, the integration of Yahoo’s algorithmic search into Bing is not expected to be complete until the end of the year, and the migration of U.S. advertisers and publishers may have to wait till after the 2010 holiday season. Global advertisers will take the big leap in 2012.

Microsoft’s AdCenter platform will handle self-serve search campaigns for Yahoo! sites as the company licenses its search technology and Panama ad-buying system to Microsoft for the 10 year period. Yahoo!, however, will be in charge of sales for premium, non-automatic search campaigns on both companies’ owned sites.

The DOJ’s statement was less a blessing than a recognition that a Microsoft-Yahoo! search tag team is not going to discourage competition in the U.S. market. The DOJ did suggest the partnership would “enable more rapid improvements in the performance of Microsoft’s search and paid advertising technology.”

Antitrust regulators’ lack of objection was a 180 from their reaction to a proposed Yahoo!-Google search deal in 2008, a proposed partnership that was also chastised by advertising agency advocates before Google withdrew its proposal. Agencies were quite pleased with the Microsoft-Yahoo! coupling.

Google had no comment about being a jilted suitor as it was drowning its sorrows in scotch at a dimly lit bar, softly muttering about the one that got away (not Yelp, the other one that got away).

“Although we are just at the beginning of this process, we have reached an exciting milestone,” gushed Microsoft CEO Steve Ballmer in a statement from the companies. “I believe that together, Microsoft and Yahoo! will promote more choice, better value and greater innovation to our customers as well as to advertisers and publishers.”

Regulatory approval has to be some consolation for Yahoo!, whose search numbers have been slipping since the release of Bing over the summer. Also, Compete released data this week that Facebook has overtaken Yahoo as the second-most popular website in the U.S.

For some reason the thought of Yahoo! jumping on the shoulders of Microsoft to take on the gargantuan Google really reminds me of this silly Monty Python sketch in which diminutive archeologists take on the literal giants of the field through piggybacking. (The whole bit is hilarious, but the section I refer to starts about five minutes in.)





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