Yahoo chooses to stay with Microsoft

The agreement announced extends a
search partnership that Yahoo Inc. and
Microsoft Corp. forged in 2009 while they
were being led by different CEOs.
SAN FRANCISCO: Yahoo and Microsoft will
keep working together on internet search,
but Yahoo is getting more control over the
how the search results are presented.
The agreement announced extends a search
partnership that Yahoo Inc. and Microsoft
Corp. forged in 2009 while they were being
led by different 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 US 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% of the search revenue to Yahoo. The
companies said their economic arrangement
won't change under the revised agreement.
The revised contract gives Yahoo 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 15
cents to $45.88 in Thursday's afternoon
trading while Microsoft shares added 6
cents to $42.32.