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What The Microsoft / Yahoo / Bing Deal Means For Micro-ISVs

July 29, 2009 by Kohan Ikin


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It's official: Yahoo! has decided "it's time to Bing". Microsoft & Yahoo have officially announced their search marketing deal:

http://www.choicevalueinnovation.com/

[I kid you not. That's really the official domain of their joint announcement.]

It appears that Yahoo Search will now be powered by Microsoft Bing, and that Yahoo Advertising will be powered by Microsoft adCenter. Microsoft gets to incorporate Yahoo algorithms into Bing (if they choose), and Yahoo is bowing out of the search engine and PPC advertising business. It looks like Yahoo Search will remain, but only as a front-end for Bing. (Though old-timers may remember, Yahoo has been powered by Inktomi and Google at different times in the past.)

Yahoo remains an independent company and will focus on its core competencies (eg Yahoo Mail & Yahoo Messenger, as well as their other web properties, like Flickr).

This deal now gives Microsoft 21.44% of search engine marketshare, based on June 2009 search marketshare figures from Hitwise. They're still only a quarter the size of Google, but that's still enough to make them the #2 player in search, and therefore also in search-related PPC advertising.

So what does this mean for micro ISVs?

Of course, one company that is very excited about all this is Ask.com. After years of trying, they've finally moved up a rank to become the #3 search engine ;)