Several media are reporting that Yahoo ! (YHOO) and Microsoft (MSFT) are as little as a day away from a partnership that would marry their search engine businesses, but the details on how this would be accomplished are conflicting and the framework seems to be complex.
AllThingsD reports that,”Sources said Microsoft search technology will be used on Yahoo sites, although it is not clear if it will be branded as `powered by Bing’–Microsoft’s handsome and innovative new search offering–or not.” The Dow Jones site also say that Yahoo! will keep 110% of the revenue from the partnership for two years.
The Wall Street Journal says that “In a shift from earlier discussions, Yahoo would handle selling the text ads that appear next to the search results for its sites and some Microsoft sites.”
The AP had a story saying that Microsoft would sell some of the search ads on its site. Other media reports contradicted that.
Which company’s technology will be used and which company will be doing the selling seems to be up in the air. One thing that is certain is that the more complicated the transaction is, the more likely it is to encounter difficulties in integration and the longer its is likely to take to be effective.
Google will have 65% of the US search market when the Microsoft/Yahoo! partnership is up and running. The joint venture will have less than 30%. Execution will be essential to its success, and it appears that having two sales forces selling one technology for two sites is an unusually complicated approach. In short, too many cooks spoil the broth.
Douglas A. McIntyre
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