Roundup: Microsoft-Yahoo Search Deal

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Well the big news of the day has been the big Microsoft-Yahoo Search deal that was announced this morning.  All the search marketing blogs, tech blogs, news sites, and everyone else has been talking about it.  With the avalanche of deal information and opinion out there, we thought we’d wade through the content and post some links to the stories and posts we found to be the most interesting.

Before we get to the round-up list, let’s quickly go over the basics of the deal.

  • The term of the agreement is 10 years.
  • Microsoft will acquire an exclusive 10 year license to Yahoo!’s core search technologies, and Microsoft will have the ability to integrate Yahoo! search technologies into its existing Web search platforms;
  • Microsoft’s Bing will be the exclusive algorithmic search and paid search platform for Yahoo! sites. Yahoo! will continue to use its technology and data in other areas of its business such as enhancing display advertising technology;
  • Yahoo! will become the exclusive worldwide relationship sales force for both companies’ premium search advertisers. Self-serve advertising for both companies will be fulfilled by Microsoft’s AdCenter platform, and prices for all search ads will continue to be set by AdCenter’s automated auction process;
  • Each company will maintain its own separate display advertising business and sales force;
  • Yahoo! will innovate and “own” the user experience on Yahoo! properties, including the user experience for search, even though it will be powered by Microsoft technology;
  • Microsoft will compensate Yahoo! through a revenue sharing agreement on traffic generated on Yahoo!’s network of both owned and operated (O&O) and affiliate sites;
  • Microsoft will pay traffic acquisition costs (TAC) to Yahoo! at an initial rate of 88 percent of search revenue generated on Yahoo!’s O&O sites during the first five years of the agreement; and
    • Yahoo! will continue to syndicate its existing search affiliate partnerships
    • Microsoft will guarantee Yahoo!’s O&O revenue per search (RPS) in each country for the first 18 months following initial implementation in that country;
  • At full implementation (expected to occur within 24 months following regulatory approval), Yahoo! estimates, based on current levels of revenue and current operating expenses, that this agreement will provide a benefit to annual GAAP operating income of approximately $500 million and capital expenditure savings of approximately $200 million. Yahoo! also estimates that this agreement will provide a benefit to annual operating cash flow of approximately $275 million; and
  • The agreement protects consumer privacy by limiting the data shared between the companies to the minimum necessary to operate and improve the combined search platform, and restricts the use of search data shared between the companies. The agreement maintains the industry-leading privacy practices that each company follows today.

It is important to note, that the integration of Bing and Yahoo core search could take up to 24 months to complete.  So this isn’t going to turn your SEO campaign on it’s head overnight, but it is important to keep tabs on the merger over the coming months and begin to develop a strategy to address the new, more important Bing search.

Microsoft-Yahoo Search Deal News Roundup

Microsoft press release: Microsoft, Yahoo! Change Search Landscape

Yahoo! blog post: What our Microsoft deal means to you

Henry Blodget gives his first take on the Microsoft-Yahoo deal over at businessinsider.com

Rand Fishkin published a great post at SEOmoz about the Top 10 Things the Microsoft/Yahoo! Deal Changes for SEO

From TechCrunch:

Yahoo Search Powered By Microsoft Bing: What SEMs Need To Know from Search Engine Roundtable

It’s Finally Official, Microsoft & Yahoo Make A Deal, Yahoo Gives Up On Search from Search Engine Land

From Marketing Pilgrim:

Feel free to add links to other interesting opinions about the deal in the comments section.

Search Engine Users Prefer Their News, Video, and Image Results Blended…Not Vertical

Search marketing firm, iProspect, published the results of a study regarding user behavior and blended search results. The study was conducted by Jupiter Research and sponsored by iProspect. Blended search results are a combination of traditional web page results and one or more specialized results such as news, videos, or images. See the screen shot below for an example of a blended search result. (click to enlarge)

Over the past year Google, Yahoo, and MSN/Live have launched versions of blended search. The iProspect study revealed that search engine users click on news, image, and video results in blended search results more than they click on results in a vertical only search such as Google News or Google Image search.

Key statistics from the study:

  • 36% of search engines user click “news” results within blended search results, while only 17% click a “news” result after conducting a news-specific search
  • 31% of search engine users click “image” results within blended search results, while 26% click an “image” result after conducting an image-specific search
  • 17% of search engine users click “video” results within blended search results, while only 10% click a “video” result after conducting a video-specific search
  • While images are the most clicked type of result after a vertical-specific search, news items are the most clicked type of result within blended search results

Komodo Links: Self Serving Reviews, FriendFeedFeed, an Open Letter to Google, and AOL Buys Bebo

We’ve got some interesting and humorous links from the past week for this installment of Komodo Links. So sit back and enjoy while you wait for the weekend to begin.

RealSelf.com, an independent site for consumers to discuss anti-aging treatments, has accused plastic surgery corporation, Lifestyle Lift, of breach of contract and computer fraud. Basically RealSelf.com claims that Lifestyle Lift agents posed as patients and posted positive reviews about Lifestyle Lift procedures. These charges were filed as a counterclaim to a Lifestyle Lift lawsuit filed against RealSelf.com for trademark infringement. MediaPost has more on this plastic surgery soap opera.

Here’s a funny post (and comments) about FriendFeedFeed. FriendFeedFeed, currently in “pre-beta,” aggregates all your social networking aggregator feeds into one aggregated feed of aggregator activity feeds. Definitely a quality piece of Web 2.0 satire.

On a more serious note, Danny Sullivan writes an open letter to Google. In the letter, Danny asks Google to divest itself of Performics, DoubleClick’s SEO firm. “Google’s in the SEO business now, …conflict of interest? You bet.”

And in an unexpected move, AOL buys social network Bebo for $850 million. In response, AOL users ask their grandchildren, “what’s a Bebo?”

Google Finally Gets EU Approval for Acquisition of DoubleClick

The European Commission announced today that Google’s $3.1 billion acquisition of DoubleClick can proceed without conditions. Google proposed the deal back in April to increase its sales of online display ads. Microsoft had vigorously opposed the deal saying it would hinder competition in the global online ad market. In the end Microsoft could only stall the deal, not kill it. You can read the rest over at Bloomberg.

Ask.com Wants to Answer Your Questions…Again

Ask.com, one of the major players in the search engine space, has announced that it will be cutting 8% of its workforce and focusing on its core user, married women. The Wall Street Journal article outlining ask.com’s new strategy (free preview) goes into greater detail. The San Francisco Chronicle touches on the ask.com retreat in their Daily Digest.

After years of trying to compete as a credible, all-purpose alternative to Google, Ask is throwing in the towel. Ask’s new strategy will be a return to their AskJeeves days where they catered to the married women of middle America “looking for help managing their lives.” As a result, Ask will go back to focusing on answering search queries posed as questions.

It will be interesting to see how Ask’s loyal users react to this new strategy. How many users who don’t fit Ask’s core demographic flee to one of the remaining major search engines? I think Ask will loose a fair amount of search traffic, as once loyal users become dissatisfied with the new strategy.

Another interesting question to ponder, will Ask’s retreat create a viable opening in the major search space for a new search engine player such as True Knowledge or Cuill?