Web News

 

Microsoft-Yahoo Search Deal Moved to 2010

The search engine merger between internet companies Microsoft and Yahoo!, originally slated for the end of October, is facing delays in documentation and a number of other setbacks, and has been postponed to early 2010.

The companies signed a deal in July 2009 in which Microsoft's Bing search technology will power Yahoo!'s search engine. The two have applied for approval from US regulatory authorities, but were still waiting by October 27, the expected launch date.

Yahoo!, which would take care of advertising sales, has recently filed a statement with the U.S. Securities and Exchange Commission, the first sign that the transaction is taking longer than either party had expected.

Microsoft refused to comment on the delay, but a Yahoo! spokesman released a statement saying both parties are working hard on finalizing agreements, have agreed to step up their efforts, and are making good progress on the matter.

Once the deal passes U.S. regulations, it will have to go through European authorities, which would further stretch the waiting time. However, the spokesman said, both parties are optimistic that the deal will push through before mid-2010.

Ian Maude of Enders Analysis says the delay isn't very surprising, given that the two parties involved are former rivals. The challenge, he says, is both technological and cultural, and requires “intense regulatory oversight.”

The merger is designed to pool the efforts of both companies in order to take on search engine giant Google, which currently accounts for 84.5% of all Internet searches. By contrast, Bing and Yahoo! searches had market shares of 3.5% and 6.68% respectively.

At the recent Web 2.0 Conference in San Francisco, Google co-founder Sergey Brin expressed disappointment that Yahoo! had more or less quit the search engine race, saying the company had been making great innovations in recent years.