Two Very Brief Things About the Microsoft/Yahoo Deal

By  |  Wednesday, July 29, 2009 at 10:09 am

BinghooIt won’t be a truly done deal until it gets regulatory approval, but Microsoft and Yahoo have finally agreed to a partnership which, among other things, will make Bing the search engine on Yahoo and have Yahoo selling ads on Bing. The two companies’ explanation of why this is a good idea is summed up in the name of the microsite about the deal which they’ve launched: ChoiceValueInnovation.com.

Thing 1:

In Microsoft’s press release, CEO Steve Ballmer explains why this is a good idea for everyone concerned:

Through this agreement with Yahoo!, we will create more innovation in search, better value for advertisers and real consumer choice in a market currently dominated by a single company.

Setting aside the question of whether this’ll turn out to be good for consumers–it might–isn’t it bizarre to see the CEO of Microsoft arguing that a market being dominated by one company is bad for consumers?

Thing 2:

Back in 2004, Yahoo dumped Google as its search engine in favor of its own homegrown engine–the one it now plans to ditch for Bing. Back then, its press release explained the benefits thusly:

The combination of a world-class engineering team and proprietary search technologies, together with Yahoo!’s global reach, breadth and depth of content and leading network assets, uniquely positions Yahoo! to change the game in search.

That was Yahoo Senior VP Jeff Weiner. Here’s current Yahoo CEO Carol Bartz on the Microsoft deal:

This agreement comes with boatloads of value for Yahoo!, our users, and the industry. And I believe it establishes the foundation for a new era of Internet innovation and development. Users will continue to experience search as a vital part of their Yahoo! experiences and will enjoy increased innovation thanks to the scale and resources this deal provides.

In 2004, being proprietary was supposed to provide the scale and resources that would change search for the better; now it’s outsourcing search to Microsoft that’s supposed to accomplish the same results. Oddly enough, nobody ever issues a press release about a deal quoting an executive explaining why it’s a bad idea…even though many deals turn out to be disappointing. (McCracken’s third law of tech-company press releases: Any news described in any press release will always lead to increased innovation…)

 
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5 Comments For This Post

  1. Josh Says:

    Thing 1 is what strikes me the most. I support Google’s supposed “monopoly” — although that’s a terribly inaccurate term to use with respect to search engines — because only a powerful monopoly can battle the even larger, more powerful monopoly. We need powerful companies to scare Microsoft because it’s obvious that the U.S. justice system isn’t interested in enforcing the law.

  2. Krishna Santani Says:

    This agreement would definitely provide a much needed momentum to Bing in terms of traffic as large scale traffic is mandatory in order to learn what people search for. Its tough to say for now that whether this move would eat away Google’s market share but without doubt this will be good for consumers as competition is always healthy

  3. Jeff Says:

    A choice tied to Microsoft is a bad choice.

  4. ray Says:

    This deal sounding so great. The acquisition of Microsoft with Yahoo could be a positive move for several reasons. First of all Microsoft hopes to gain a foothold in the online advertising business and this merge would enable that. Also this move would “allow the two companies to pool their resources in order to take on a common enemy — Google (Charts, Fortune 500) — as opposed to wasting money by competing against each other” (La Monica). Microsoft needs a strong merge in order to improve their revenue and me a strong competitor with online advertisers.

    There are several other pros associated in competing with Google jointly.

    For this and more visit http://en.oboulo.com/microsoft-s-pursuit-of-yahoo-55595.html

    Getting the Microsoft and Yahoo to compete against Google? unbelievable. Not many businesses can claim that they have had such an impact in today’s culture to warrant an entry in the dictionary. The founders of Google, Sergey Brin and Larry Page, can boast that and so much more.

    This deal sounding so great. The acquisition of Microsoft with Yahoo could be a positive move for several reasons. First of all Microsoft hopes to gain a foothold in the online advertising business and this merge would enable that. Also this move would “allow the two companies to pool their resources in order to take on a common enemy — Google (Charts, Fortune 500) — as opposed to wasting money by competing against each other” (La Monica). Microsoft needs a strong merge in order to improve their revenue and me a strong competitor with online advertisers.

    There are several other pros associated in competing with Google jointly.

    For this and more visit http://en.oboulo.com/how-google-s-hands-off-mar

  5. Neurologist Says:

    This is yahoo just farming off something they arent focused on at the moment. I know this deal is about Scale.. however, both Bing and Yahoo together doesnt provide enough scale to compete with Google.

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