Danny Sullivan put it well in his Yahoo & Google Together Again In New Search Deal. This month, Yahoo said they reached an agreement with Google to have Yahoo Search powered, in part, by Google search and Google ads.
You can read it in their investor report:
In October, the Company reached an agreement with Google that provides Yahoo with additional flexibility to choose among suppliers of search results and ads. Google's offerings complement the search services provided by Microsoft, which remains a strong partner, as well as Yahoo's own search technologies and ad products.
Didn't we see signs of this in July? We did, Yahoo confirmed they were testing Google search results over Bing powered search results. In Danny's article, he goes through many of the facts, what ifs and so on.
In the transcript of the earnings call, Marissa Mayer added:
In addition, today I'm pleased to announce that we have signed a three-year partnership with Google to bolster our search capabilities. This partnership will be supplementary to our existing relationship with Microsoft. The partnership with Google is non-exclusive and does not have minimum volume commitments. It covers both desktop and mobile traffic in the United States and many of our primary international markets. It is subject to a voluntary regulatory review by the Department of Justice and will only be implemented after that.
And in the Q&A portion, here are more snippets:
Anthony DiClemente - Nomura Securities International, Inc. Thanks a lot. I have two. First, for Marissa, I wanted to just ask about the Google agreement. The deal is non-exclusive. It sounds like Yahoo! has the discretion as to which of the ad services it uses to monetize search queries. So can you just, for our benefit, walk us through the mechanics of how Yahoo! determines which of the queries are monetized by Microsoft, by Google, by Yahoo!? And then just broadly, how much do you think that this deal, this agreement could potentially improve search monetization?Marissa A. Mayer - President, Chief Executive Officer & Director Sure. Obviously, this is a new development for us. We're excited to be announcing the partnership today. It is still subject to the regulatory review and we won't be implementing the partnership with Google until after that. And as part of this process, we're going to be investing in understanding how to balance the marketplace of our search queries in terms of how to provide the best results as well as the best monetization, and so we see some opportunities in terms of providing coverage of more ads on more queries. We also see some opportunities in different international regions to just achieve a different blending.
And I would also say we're very confident in our Yahoo! Gemini platform for search. And when we look at mobile we actually, as you know, have a different view in terms of what mobile search should be over time and what the best possible ways to monetize that are and really provide value to advertisers. And so for us the Yahoo! Gemini platform is really where we want to invest particularly on mobile in new formats, new ideas, and so I think you should expect to see a lot of our mobile traffic move to Yahoo! Gemini and for us to basically develop a technology that does a good job competitively balancing both the Bing and Google opportunities in terms of monetization.
Right now, Microsoft has to power 51% of the Yahoo Search desktop search results and ads. The mobile side, there is no such agreement. So I guess we will see how it plays out for them.
Forum discussion at WebmasterWorld.
