Microsoft and Yahoo Seal Web Deal

Yahoo and Microsoft have announced a long-rumoured internet search deal that will help the two companies take on chief rival Google. Microsoft's Bing search engine will power the Yahoo website and Yahoo will in turn become the advertising sales team for Microsoft's online offering. Yahoo has been struggling to make profits in recent years. But last year it rebuffed several takeover bids from Microsoft in an attempt to go it alone.

Microsoft boss Steve Ballmer said the 10-year deal would provide Microsoft's Bing search engine with the necessary scale to compete.
"Through 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," said Mr Ballmer.
"Microsoft and Yahoo know there's so much more that search could be. This agreement gives us the scale and resources to create the future of search," he added.
Yahoo is bowing to the inevitable. It simply had neither the resources nor the focus to win the technological arms race for search supremacy

In return for ceding control of its search engine, Yahoo will get to keep 88% of the revenue from all search ad sales on its site for the first five years of the deal, and have the right to sell ads on some Microsoft sites.
Yahoo's search team, meanwhile, will have to brace itself for job losses over the next two years. Some staff will transfer to Microsoft, others can stay on with Yahoo, but redundancies would be unavoidable, according to Yahoo chief executive Carol Bartz.

Yahoo said the deal would benefit Yahoo's users and advertisers.
"This 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," said Ms Bartz.

January 2008: Microsoft offers to buy Yahoo for $44.6bn in cash and shares, later raised to $47.5bn
May 2008: Microsoft walks away from the table after the two sides fail to agree on a price
November 2008: Yahoo co-founder Jerry Yang stands down as the firm's boss
April 2009: Yahoo says it will cut 5% of its workforce after quarterly profits drop sharply
May 2009: Microsoft relaunches its own search engine, now branded bing.com
July 2009: After new speculation, Microsoft and Yahoo finally announce a web search deal.

The combined search engines should provide users with many more resources.I look forward to using it.