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Yahoo-Microsoft search deal could be near

15 января 2009

Several sources close to Yahoo and Microsoft Corp. have told BoomTown that a search partnership deal between the companies is more likely to be signed quickly, now that Yahoo has picked former Autodesk Chief Executive Carol Bartz as its next CEO.

Such a deal, which the pair have tried unsuccessfully to strike many times, would be a big boost to Bartz, who is coming into a very difficult turnaround situation at the troubled Internet concern.

Sources close to Microsoft said the company has readied its proposal to be floated to the Yahoo board. Its CEO, Steve Ballmer, has been vocal in recent months about wanting to do a deal quickly.

"It's ticked and tied," said one person who has spoken to Microsoft execs of late, who predicted it could be signed as soon as Yahoo's earnings on Jan. 27.

Said another source at the software giant:"We've just been waiting for management clarity to move."

BoomTown could not get further details of the proposal, but it is likely to be similar to past ones Microsoft has offered, with a small payment upfront and a long-term and large amount of guaranteed revenue.

While some on the Yahoo board, including Yang, remain on the fence about Yahoo essentially outsourcing its search business to Microsoft in exchange for a big pile of money, it seems to be the company's only choice.

Bartz must also weigh in, of course, and she is someone who has more of an affinity for techies and might think Yahoo can continue to compete in what is turning into a pricey arms race in search between Microsoft and Google.

In any case, most agree that a union is likelier than not and a question of when, not if.

Most important, after the failed takeover attempt of Yahoo by Microsoft, aimed at owning its search business failed, the pair have only lost more market share to the hugely dominant Google.

Yahoo tried to strike a search deal with Google, which collapsed over regulatory concerns.

Given how small the Microsoft-Yahoo search combination is in comparison to Google's market share of 72%, it is less likely to encounter such difficulties.

Источник: Total Telecom

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