News came out yesterday on Valleywag about Yahoo vice president Sean Suchter leaving the company and heading to Microsoft. To do what? Sean had told me privately on Tuesday, and I’d been waiting to get an official heads-up to say more. But AllThingsD now has the formal news: to be general manager of Microsoft’s Silicon Valley Search Technology Center.

Sean’s a huge search vet, coming to Yahoo itself via the Inktomi acquisition. Old timers remember Inktomi as one of the earliest search engines out there.

His departure has apparently hurt Yahoo morale — the internal email about that Valleywag published said:

Some of you will find this news shocking given that Sean has been a Gibraltar rock at Yahoo and in particular for the Search team. . I understand this.

The move also underscores the idea that Microsoft is simply going to steal away the engineers it once said were a core reason behind its purchase of Yahoo. Why it just didn’t start stealing them before going through the entire acquisition mess is behind me. When we asked back then, they just really dodged answering.

Having a great engineering team doesn’t mean success, however. Microsoft challenge still remains daunting. Google is a habit for many. Giveways like new cars or cash rebates have yet to make any noticeable change in that habit and build share.

Distribution deals like with Sun and next year with HP may help. But personally, I think Microsoft will be in for an incredibly long uphill battle. I think that while Yahoo’s marketshare might fall, it is far from hitting its terminal velocity level that dying search engines hit. Indeed, it still has far better brand recognition that Microsoft Windows Live.

Yahoo CEO Jerry Yang might be the punching bag in the search space right now, but make no mistake. If Microsoft doesn’t seriously budge its search share by this time next year, people are going to be questioning whether it was Microsoft that should have gotten out of search (for all the money it has and continues to put into it) and perhaps outsourced to Yahoo.

For more, see discussion on Techmeme.

Related Topics: Microsoft: Business Issues | Microsoft: Employees | Yahoo: Business Issues | Yahoo: Employees

About The Author: Danny Sullivan is editor-in-chief of Search Engine Land. He’s a widely cited authority on search engines and search marketing issues who has covered the space since 1996. Danny also oversees Search Engine Land’s SMX: Search Marketing Expo conference series. He maintains a personal blog called Daggle (and maintains his disclosures page there). He can be found on Facebook, Google + and microblogs on Twitter as @dannysullivan. See more articles by Danny Sullivan