<http://schema.org/articleBody>
"If you've been following the story about the Microsoft-Yahoo search deal, the details of which have been leaking out in the last 24 hours, you're probably confused. The deal itself is very different from what was speculated the first time around. \nNow, we've got the official press release below; we'll also point out the most important facts about the deal to make it easier to understand. In the shortest possible terms, Yahoo is cutting costs by ditching its own search, and Microsoft is becoming Google's biggest competitor when it comes to search; it is also cutting costs by letting Yahoo handle ad sales for premium search advertisers. \n- Microsoft's Bing will now be the search engine on all Yahoo sites.- Yahoo will provide the relationship sales force for both companies\u2019 premium search advertisers. - Each company will maintain its own separate display advertising business.- Self-serve advertising for both companies will go through Microsoft\u2019s AdCenter platform.- Microsoft will compensate Yahoo through a revenue sharing agreement on traffic generated on Yahoo\u2019s network.- The term of the agreement is 10 years.\nFull press release below:\n\u2014-\nMicrosoft, Yahoo! Change Search Landscape\nGlobal Deal Creates Better Choice for Consumers and Advertisers\nSUNNYVALE, CA and REDMOND, WA \u2014 July 29, 2009 \u2014 Yahoo! and Microsoft announced an agreement that will improve the Web search experience for users and advertisers, and deliver sustained innovation to the industry. In simple terms, Microsoft will now power Yahoo! search while Yahoo! will become the exclusive worldwide relationship sales force for both companies\u2019 premium search advertisers.\nFor Web users and advertisers, this deal will accelerate the pace and breadth of innovation by combining both companies\u2019 complementary strengths and search platforms into a market competitor with the scale to fuel sustained development in search and search advertising. Users will find what they care about faster and with more personal relevance. Microsoft\u2019s competitive search platforms will lead to more value for advertisers, better results for Web publishers, and increased innovation and efficiency across the Internet.\nUnder this agreement, Yahoo! will focus on its core business of providing consumers with great experiences with the world\u2019s favorite online destinations and Web products.\n\u201CThis agreement comes with boatloads of value for Yahoo!, our users, and the industry, and I believe it establishes the foundation for a new era of Internet innovation and development,\u201D said Yahoo! Chief Executive Officer Carol Bartz. \u201CUsers will continue to experience search as a vital part of their Yahoo! experiences and will enjoy increased innovation thanks to the scale and resources this deal provides. Advertisers will also benefit from scale and enjoy greater ease of use and efficiencies working with a single platform and sales team for premium advertisers. Finally, this deal will help us increase our investments in priority areas in winning audience properties, display advertising capabilities and mobile experiences.\u201D\nProviding a viable alternative to advertisers, this deal will combine Yahoo! and Microsoft search marketplaces so that advertisers no longer have to rely on one company that dominates more than 70 percent of all search. With the addition of Yahoo!\u2019s search volume, Microsoft will achieve the size and scale required to unleash competition and innovation in the market, for consumers as well as advertisers.\nMicrosoft Chief Executive Officer Steve Ballmer said the agreement will provide Microsoft\u2019s search engine, Bing, the scale necessary to more effectively compete, attracting more users and advertisers, which in turn will lead to more relevant ads and search results.\n\u201CThrough this agreement with Yahoo!, we will create more innovation in search, better value for advertisers and real consumer choice in a market currently dominated by a single company,\u201D said Ballmer. \u201CSuccess in search requires both innovation and scale. With our new Bing search platform, we\u2019ve created breakthrough innovation and features. This agreement with Yahoo! will provide the scale we need to deliver even more rapid advances in relevancy and usefulness.  Microsoft and Yahoo! know there\u2019s so much more that search could be.  This agreement gives us the scale and resources to create the future of search.\u201D\n\u201CThis deal fits the long-term strategic direction of Yahoo! to remain the world\u2019s leading online media company and Carol Bartz has the full and unanimous support of the Yahoo! Board behind this deal,\u201D said Roy Bostock, chairman, Yahoo! Inc. \u201CThis is a significant opportunity for us. Microsoft is an industry innovator in search and it is a great opportunity for us to focus our investments in other areas critical to our future.\u201D\nThe key terms of the agreement are as follows:\n\u00B7         The term of the agreement is 10 years;\n\u00B7         Microsoft will acquire an exclusive 10 year license to Yahoo!\u2019s core search technologies, and Microsoft will have the ability to integrate Yahoo! search technologies into its existing Web search platforms;\n\u00B7         Microsoft\u2019s Bing will be the exclusive algorithmic search and paid search platform for Yahoo! sites. Yahoo! will continue to use its technology and data in other areas of its business such as enhancing display advertising technology;\n\u00B7         Yahoo! will become the exclusive worldwide relationship sales force for both companies\u2019 premium search advertisers. Self-serve advertising for both companies will be fulfilled by Microsoft\u2019s AdCenter platform, and prices for all search ads will continue to be set by AdCenter\u2019s automated auction process;\n\u00B7         Each company will maintain its own separate display advertising business and sales force;\n\u00B7         Yahoo! will innovate and \u201Cown\u201D the user experience on Yahoo! properties, including the user experience for search, even though it will be powered by Microsoft technology;\n\u00B7         Microsoft will compensate Yahoo! through a revenue sharing agreement on traffic generated on Yahoo!\u2019s network of both owned and operated (O&amp;O) and affiliate sites;\no   Microsoft will pay traffic acquisition costs (TAC) to Yahoo! at an initial rate of 88 percent of search revenue generated on Yahoo!\u2019s O&amp;O sites during the first five years of the agreement; and\no   Yahoo! will continue to syndicate its existing search affiliate partnerships.\n\u00B7         Microsoft will guarantee Yahoo!\u2019s O&amp;O revenue per search (RPS) in each country for the first 18 months following initial implementation in that country;\n\u00B7         At full implementation (expected to occur within 24 months following regulatory approval), Yahoo! estimates, based on current levels of revenue and current operating expenses, that this agreement will provide a benefit to annual GAAP operating income of approximately $500 million and capital expenditure savings of approximately $200 million. Yahoo! also estimates that this agreement will provide a benefit to annual operating cash flow of approximately $275 million; and\n\u00B7         The agreement protects consumer privacy by limiting the data shared between the companies to the minimum necessary to operate and improve the combined search platform, and restricts the use of search data shared between the companies. The agreement maintains the industry-leading privacy practices that each company follows today.\nThe agreement does not cover each company\u2019s Web properties and products, email, instant messaging, display advertising, or any other aspect of the companies\u2019 businesses.  In those areas, the companies will continue to compete vigorously.\nThe transaction will be subject to regulatory review.  The agreement entered into today anticipates that the parties will enter into more detailed definitive agreements prior to closing.   Microsoft and Yahoo! expect the agreement to be closely reviewed by the industry and government regulators, and welcome questions. The companies are hopeful that closing can occur in early 2010.\nThe companies have established a website at http://www.choicevalueinnovation.com to provide consumers, advertisers and publishers with additional information about the benefits of the agreement.\nConference Call \u2013 5:30 a.m. PDT, Wednesday, July 29\nYahoo! and Microsoft will host a conference call with Yahoo! CEO Carol Bartz and Microsoft CEO Steve Ballmer to discuss the agreement at 5:30 a.m. Pacific/8:30 a.m. Eastern Time today.  To listen to the call, please dial 1-866-515-2908 in the U.S. and Canada; +1-617-399-5122 international, reservation number: 47968026. A live webcast of the call can be accessed through Yahoo!\u2019s Investor Relations website at http://yhoo.client.shareholder.com/results.cfm. In addition, an archive of the webcast will be available through the same link. An audio replay of the call will be available for two weeks following the conference call by calling 1-888-286-8010 in the U.S. and Canada; +1-617-801-6888 international, reservation number: 91217610."^^<http://www.w3.org/2001/XMLSchema#string>
<http://mashable.com/2009/07/29/yahoo-microsoft-search-deal-2/>