Yahoo – Mircrosoft Search Deal – Will It play Into Google’s Hands?

Writing by Nick Stamoulis on Saturday, July 18, 2009 Leave a comment

There are more reports of a pending deal between Yahoo! and Microsoft although there seems to be a blurring of the exact nature of the deal. Will it be a search deal or a search advertising deal? Perhaps both? Bing has been somewhat of a hit since its release, however, until more reliable statistics surface it is hard to know if the extra traffic has been at the expense of Google or Yahoo!. If it is from Yahoo! then a deal is understandable.

Let’s face it, with Google sailing away in front of the pack, no one can afford to lose traffic to another search engine. If Yahoo! is losing search traffic then why not merge with the culprit taking that traffic – in this case Microsoft.

There are couple of issues to consider. First, and most importantly, like Microsoft, search and search revenue are a minor part of Yahoo!’s business. They are almost the accidental search engine and whilst the income received is significant, Yahoo! have many other revenue streams.

Microsoft on the other hand have become aggressive. Weakening Yahoo!’s position was possibly one aim when Bing was released, however, the big prize is knocking Google down a peg or two.

I am not sure that a combined Yahoo!-Bing search engine can do it. In fact, there is a distinct possibility it will play into Google’s hands with Google picking up disaffected Yahoo! users. Microsoft is not exactly a saint in the eyes of many users. If they resent the merger, then Yahoo! believers may just cross the war zone and become Google believers. It will be interesting to see how it all eventuates, and what effect it all has on search marketing.

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