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Yahoo & Google Big Announcement This Afternoon : Search Partnership?

Yahoo and Google are planning a massive announcement this afternoon on the same day that Yahoo has announced that they are no longer entertaining offers from Microsoft.

Microsoft and Yahoo had been in discussions about partnering on certain offerings, more or less paid and organic search, and those discussions led to nothing :

    Discussions with Microsoft regarding a potential transaction — whether for an acquisition of all of Yahoo! or a partial acquisition — have concluded. The conclusion of discussions follows numerous meetings and conversations with Microsoft regarding a number of transaction alternatives, including a meeting between Yahoo! and Microsoft on June 8th in which Chairman Roy Bostock and other independent Board members from Yahoo! participated. At that meeting, Microsoft representatives stated unequivocally that Microsoft is not interested in pursuing an acquisition of all of Yahoo!, even at the price range it had previously suggested.

    With respect to an acquisition of Yahoo!’s search business alone that Microsoft had proposed, Yahoo!’s Board of Directors has determined, after careful evaluation, that such a transaction would not be consistent with the company’s view of the converging search and display marketplaces, would leave the company without an independent search business that it views as critical to its strategic future and would not be in the best interests of Yahoo! stockholders.

Today’s announcement from Yahoo and Google, which may lead to the official announcement that the current head of the Yahoo Network, Jeff Weiner, is leaving the company, is probably going to have something to do with expanding the Google AdWords and Yahoo Search partnership, not handing over or outsourcing search to Google.

Last month I wrote that Yahoo should focus on its proprietary search technology and enter negotiations with Microsoft and Google about farming out its sponsored search to the better company, concentrating on Yahoo’s core offerings in behavioral, post search and profile ad targeting across the Yahoo Network.

Such a move would let Yahoo keep its core Yahoo Search Technology and then syndicating Microsoft Search Ads and/or Google AdWords in its sponsored links area; further leading to a more efficient Yahoo which isn’t tied down to competing with Google AdWords anymore in the paid search arena, which they have had problems with fully monetizing to its potential for years.

Yahoo may be able to in fact increase its revenue from search or sponsored search by working on a very Yahoo favorable revenue share split from either company, forcing a bidding war between Google and the new Microsoft owned & operated Yahoo Search Marketing (or a long term Google partnership).

Microsoft could also take the Yahoo Publisher Network, the Yahoo answer to Google AdSense which never took off, to the next level.

I still think this will be the answer, but a major issue is Yahoo opening Google’s competing advertising network into their war room, giving Google advertising access to Yahoo user search patterns. The main issue, if there is one, is how Yahoo can work with Google to better monetize search, while still holding on to is masterful position as a display advertising and content driven portal.

I also think Yahoo has a lot to learn by looking at the AOL model.

What do you think the announcement will be?

Category SEO
SEJ STAFF Loren Baker Founder at Foundation Digital

Loren Baker is the Founder of SEJ, an Advisor at Alpha Brand Media and runs Foundation Digital, a digital marketing ...

Yahoo & Google Big Announcement This Afternoon : Search Partnership?

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