14 DAY TRIAL // Redmond-based Microsoft and Yahoo announced on Wednesday an agreement according to which Microsoft’s Bing search technology would power Yahoo's search and advertising for the following 10 years. While the deal involves the mobile sites as well, it seems that this part is not exclusive, and Yahoo is enabled to choose another partner in case it wants to do so.
"We have the option for using Microsoft technology for the mobile web experience, (but) it’s not exclusive as it is for the PC. We will start exercising the right to do that,” Yahoo CEO Carol Bartz said during a conference call. Microsoft CEO Steve Ballmer also commented, “We don’t know what we don’t know,” but also stated that Yahoo has additional flexibility in this deal.
When it comes to the mobile search market in different areas, it seems that the only geography where the two will be dominating is the United States. Currently, Microsoft has a partnership with Verizon for the search services, while Yahoo entered similar deals with AT&T and T-Mobile. The other major carrier in the country, Sprint, uses Google's services. For comparison, Sprint has a number of around 48 million subscribers, while the rest of the carriers reach 200 million subscribers together.
According to some estimations, Yahoo would account for around 34.6 percent of the mobile search market in the US, while Google has the leading position, with 63 percent. Combined, Microsoft and Yahoo's share would remain behind Google's yet we shouldn't forget that Bing is just kicking off. At the same time, we should also note that Yahoo currently has agreements with 70 mobile phone operators around the world, and Microsoft's search engine would be greatly promoted this way.
“We think that the mobile sphere in general is nascent and rapidly changing, therefore to create an exclusive relationship at this point in time just felt like early innings. We like the structure of this relationship, which allows us to be non-exclusive with Microsoft,” Yahoo EVP Hilary Schneider said in an interview with mocoNews. “I think, to be honest with you, we have our hands full just trying to continue to pioneer and catch up with some of the pieces we’ve been doing with our own mobile search client,” Microsoft SVP Yusuf Mehdi stated. The bottom line is that Bing will be used for Yahoo’s mobile sites, which should enable the company to invest in other areas.