Bada-Bing: Yahoo, Microsoft Close to Search Engine Deal

By Mat Probasco, Newser Staff

Posted Jul 27, 2009 3:44 AM CDT

(Newser) – Yahoo is close to a deal that would make Microsoft's Bing its new search engine, reports Advertising Age. To Yahoo's dismay, the deal will likely involve revenue sharing, not a fat up-front paycheck. Negotiations, which have been heated over the amount of revenue each side gets from search ad clicks, are expected to wrap up this week.

Yahoo may have no choice but to partner with Microsoft, which is reportedly willing to spend up to $11 billion on its search operations over five years. Together, both companies will benefit by chipping away at Google's search dominance—with the Bing-Yahoo consolidation taking a roughly 30% search share.

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This screen shot shows Yahoo Inc.'s Search Pad interface. (AP Photo)

Yahoo Inc. headquarters in Sunnyvale, Calif. (AP Photo/Paul Sakuma, file)

The Microsoft logo is seen at the company's exhibit at the Consumer Electronics Show in Las Vegas. (AP Photo/Paul Sakuma, file)

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As Bing grows, the first place Bing takes share from is not Google but the other guys. So Yahoo is going to lose share unless they have something radical planned. - Tim Cadogan, CEO of ad-serving
firm OpenX

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