Ya­hoo chooses to keep work­ing with Mi­crosoft in up­dated search deal

The China Post - - WORLD BUSINESS -

Ya­hoo and Mi­crosoft will keep work­ing to­gether on In­ter­net search, but Ya­hoo is get­ting more con­trol over the how the search re­sults are pre­sented.

An agree­ment an­nounced Thurs­day extends a search part­ner­ship that Ya­hoo Inc. and Mi­crosoft Corp. forged in 2009 while they were be­ing led by dif- fer­ent CEOs. Cur­rent Ya­hoo CEO Marissa Mayer had the op­tion of ter­mi­nat­ing the re­la­tion­ship un­der a clause trig­gered ear­lier this year.

The two are try­ing to chip away at Google’s dom­i­nance of In­ter­net searches. They haven’t had much suc­cess so far. Google still con­trols two-thirds of the U.S. search mar­ket and holds an even larger share in Europe. Mayer spent 12 years help­ing Google build its lu­cra­tive lead in be­fore be­com­ing Ya­hoo’s CEO in 2011.

As has been the case since the com­pa­nies formed their al­liance, Mi­crosoft’s tech­nol­ogy will power most of the search re­sults on Ya­hoo’s sites. In re­turn, Ya­hoo will re­ceive most of the rev­enue from the ads posted along­side the search re­sults on its sites.

The orig­i­nal deal called for Mi­crosoft to pay 88 per­cent of the search rev­enue to Ya­hoo. The ad com­mis­sion rose to 90 per­cent in late Fe­bru­ary, ac­cord­ing to reg­u­la­tory fil­ings. The com­pa­nies said their eco­nomic ar­range­ment won’t change un­der the re­vised agree­ment.

The re­vised con­tract gives Ya- hoo more con­trol over the how its search page looks and works. There will be a few dif­fer­ences in how the com­pa­nies sell ads un­der the new agree­ment.

In­vestors ev­i­dently don’t think much is go­ing to change. Ya­hoo’s stock gained 5 cents to close Thurs­day at US$45.78 while Mi­crosoft shares shed 10 cents to close at US$42.16.

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