San Francisco, April 19, 2009
The Economic Times
It's been more than a year since Microsoft Corp's unsolicited bid to buy Yahoo Inc ended in tatters and acrimony. Now the two companies are talking again, with the less contentious agenda of forging an Internet search advertising partnership having replaced the notion of an outright merger.
Analysts say that co-opting Yahoo's search assets represents Microsoft's best hope to turn around its money-losing online business and to challenge Google Inc's dominant and growing share of the U.S. search market. But handing search over to Microsoft would be fraught with risk for Yahoo, which would cede what is believed to be a profitable and increasingly vital plank in its online business.
Search data is increasingly used to custom-tailor display advertisements for Web surfers. "You don't walk away from search unless there's some ridiculously huge number in front of you," said RBC Capital Markets analyst Ross Sandler.
Yahoo Chief Executive Carol Bartz and Microsoft CEO Steve Ballmer recently talked about various partnerships, possibly with Microsoft managing Yahoo's search advertising business and Yahoo handling display ads across Microsoft's websites, according to a source familiar with the situation.
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