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Yahoo and Microsoft do the Deal
Date: 7/29/2009 9:16:55 AM
NEW YORK (CNNMoney.com) -- Microsoft and Yahoo reached a long-awaited partnership Wednesday in a bid to challenge Google's dominance in online search.
Under the 10-year deal, Yahoo.com and Bing.com will maintain their own branding but search results on Yahoo.com will say "powered by Bing." Yahoo, in turn, will be responsible for attracting premium advertisers.
Microsoft will pay Yahoo 88% of the revenue it gains from searches on Yahoo's sites. Microsoft will also have the rights to integrate Yahoo's search technology into its own existing Web search platforms.
Yahoo said the agreement will modestly decrease its overall revenue but increase its operating income by about $500 million annually.
The deal is expected to close in early 2010. U.S. users will start to see the change three months later and users around the world will see the full effect within two years.
"This deal is really about scale," said Yahoo Chief Executive Carol Bartz on a conference call. "By combining the ... technology of both companies, we can create a real, viable alternative for advertisers."
CNNMoney