Yahoo-Microsoft search deal gets final OK

By David Goldman, staff writer


NEW YORK (CNNMoney.com) -- Microsoft and Yahoo said Thursday that their online search deal has received approval from U.S. and European Union regulators, paving the way for the two companies to combine much of their Internet search business.

Under the 10-year deal, which was announced in July, Yahoo.com and Bing.com will maintain their own branding but search results on Yahoo.com will say "powered by Bing." Yahoo, in turn, will be responsible for getting premium advertisers.

Microsoft will pay Yahoo 88% of the revenue it gains from searches on Yahoo's sites. Microsoft will also have the rights to integrate Yahoo's search technology into its own existing Web search platforms.

With the final hurdle out of the way, the companies said Thursday that they will start implementing their partnership in the coming days. Yahoo and Microsoft have set a goal to complete all aspects of the deal in the United States by the end of 2010 and globally by the end of 2012. The companies previously said that U.S. users will start to see the change three months after regulators approved the deal.

"This breakthrough search alliance means Yahoo! can focus even more on our own innovative search experience," said Yahoo Chief Executive Carol Bartz in a statement.

Microsoft Chief Executive Steve Ballmer called the regulatory approval "an exciting milestone," noting that the companies are "just at the beginning of this process."

Google (GOOG, Fortune 500) remains the clear dominant search engine, controlling more than 65% of the market, according to online data tracker comScore. But Microsoft's (MSFT, Fortune 500) Bing and Yahoo (YHOO, Fortune 500) control nearly 30% of the market combined, which analysts say will help the companies attract better advertising partners.

Shares of Microsoft and Yahoo both rose less than 1% in midday trading. To top of page

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