by Andy Leinicke, Paid Search Media Director

Yesterday, Yahoo announced a new partnership with MSN that is designed to give both parties greater leverage in the competition for share of the global search market. The announcement came in the form of a blog post at Yodel Anecdotal, Yahoo’s colorful corporate blog. Get the full story from Yahoo’s point of view here. Also, here is a video of Carol Bartz’s personal description:

Carol Bartz on Yahoo/Microsoft Deal

The partnership is simply a deal, not a change in the corporate structure of either entity. But it is a big deal. The term of the agreement is ten years and there is significant revenue and resource share involved. TechCrunch described the gist of the arrangement well in its post:

Microsoft will now power Yahoo! search while Yahoo! will become the exclusive worldwide relationship sales force for both companies’ premium search advertisers.

The deal does not affect either Yahoo or MSN display advertising businesses.

Our Yahoo representative assured me today that although this partnership has been finalized between Yahoo and MSN, the U.S. Government still needs to approve it. For advertisers, that means day-to-day operations won’t change at all for at least five months. Even when the deal is finalized, Yahoo estimates that an additional five to six months will be necessary to integrate technology and staffing in a way that will be material to Yahoo and Bing advertisers.

In our opinion, this deal could be a great combination of MSN’s engineering ability with Yahoo’s responsive and experienced client service and sales team. SEM management isn’t going to change in the short term but hopefully SERP advertising will improve through these networks in the coming years.

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