Since Microsoft released its new search engine Bing as a move to refresh itself, we have a clue of what Microsoft can do against the search giant Google within its future plans. Rumors had it that, Microsoft was in pursuit of a partnership, when considering its relations with Yahoo.
Now, we have left all the rumors behind and Microsoft has struck a 10-year deal with Yahoo, including its internet searched and ads.
Microsoft Chief Executive Officer Steve Ballmer made an announcement concerning the agreement, and said that the two companies will be working together on search technologies and search engine advertising within their plans. Ballmer said that this development will yield good results by all its affects, and it seems that he will challenge Google, which is quarrelling with Microsoft’s bread and butter with its web browser and operating system. Ballmer had taken Microsoft over from a genius as Bill Gates when it was a very hard time for the company, and it seems that he has already resounded in Google part. The statement of Marissa Mayer, Vice President of Search Product and User Experience of Google clearly shows that, as she said she considers this deal harmful for competition.
According to the deal terms, Microsoft will be able to reach Yahoo’s search technologies internally and support these technologies with its new search engine Bing. On the other hand, Yahoo will be responsible for the advertisement of both companies, while each company will maintain its own separate display advertising business and sales force. Yahoo expects that the deal will increase its annual profit by $500m and provide $275m saving from annual capital expenses.
It is not certain whether the deal will bring about a counter action from Google side, as it will create a change expected to spread in 2 years upon recognition of the contract. What is more important is, if Google will experience a decline in terms of search engine.