More Speculation On Yahoo-Microsoft Ads Deal

Yesterday on the Yahoo Q1 earnings call, CEO Carol Bartz sent a mixed message of sorts. She said at the outset that Yahoo was going to focus on key areas of the business and was open to “outsourcing” some functions if that made sense. Like me, many people listening must have immediately thought “search.” But later in the call she seemed to reaffirm the strategic value of search to Yahoo’s overall business, calling it “critical.” She spoke at some length about innovations in the user experience and on the advertising side as well, especially about the combination of search and display.

She said that advertiser reaction to the use of search queries to inform display ad serving on the Yahoo network was very postive. She anonymously quoted one advertiser who called the results “freakin’ awesome.” In all, she didn’t sound like a CEO ready to “outsource” search to Microsoft.

However both Bloomberg and AllThingsD report that Microsoft-Yahoo negotiations over an ads deal of some sort are proceeding favorably. AllThingsD calls the state of talks between the companies “hot and heavy.” Here’s my sense about what’s to come; this is a bit of pure speculation:

  • There will be a deal between the companies; it will not outsource paid or consumer search to Microsoft
  • The deal will provide access to Yahoo search (reach) for Microsoft PPC advertisers
  • Yahoo will probably gain additional display ad distribution through Microsoft sites
  • There may or may not be a search revenue guarantee (MSFT –> Yahoo) of any kind

Such a deal will probably be good for both companies, especially Yahoo. If announced we’ll see an uptick in Yahoo’s stock price, but reaction and gains will be muted until analysts can determine whether the deal will be “material.” There will also be some disappointment if the scope of the deal isn’t huge or somehow game changing for one or both companies.

An article this morning in the Wall Street Journal, based on Carol Bartz remarks in the Yahoo earnings call, cites her “repositioning” of APT, Yahoo’s relatively new advertising platform (display only right now). Perhaps in a bit of “truth telling,” Bartz described it as an ongoing project rather than a finished and polished piece of technology.

Related Topics: Channel: Industry | Features: Analysis | Microsoft & Yahoo Search Deal


About The Author: is a Contributing Editor at Search Engine Land. He writes a personal blog Screenwerk, about SoLoMo issues and connecting the dots between online and offline. He also posts at Internet2Go, which is focused on the mobile Internet. Follow him @gsterling.

Connect with the author via: Email | Twitter | Google+ | LinkedIn


Get all the top search stories emailed daily!  


Other ways to share:

Read before commenting! We welcome constructive comments and allow any that meet our common sense criteria. This means being respectful and polite to others. It means providing helpful information that contributes to a story or discussion. It means leaving links only that substantially add further to a discussion. Comments using foul language, being disrespectful to others or otherwise violating what we believe are common sense standards of discussion will be deleted. Comments may also be removed if they are posted from anonymous accounts. You can read more about our comments policy here.

Comments are closed.

Get Our News, Everywhere!

Daily Email:

Follow Search Engine Land on Twitter @sengineland Like Search Engine Land on Facebook Follow Search Engine Land on Google+ Get the Search Engine Land Feed Connect with Search Engine Land on LinkedIn Check out our Tumblr! See us on Pinterest


Click to watch SMX conference video

Join us at one of our SMX or MarTech events:

United States


Australia & China

Learn more about: SMX | MarTech

Free Daily Search News Recap!

SearchCap is a once-per-day newsletter update - sign up below and get the news delivered to you!



Search Engine Land Periodic Table of SEO Success Factors

Get Your Copy
Read The Full SEO Guide