Yahoo Filing Reveals Details of Microsoft Deal 65
CWmike writes "Microsoft will pay Yahoo $50 million a year for three years and will hire at least 400 Yahoo employees as part of the companies' recent search agreement, according to a filing with the US Securities and Exchange Commission. Yahoo's form 8-K, which appeared online on Tuesday, reveals a few additional details about the agreement. The deal, announced last week, will mean that Microsoft's Bing search engine will power Yahoo's search site and Yahoo will sell premium search ad services for both companies. Five years into the 10-year agreement, Microsoft can opt out of the exclusive engagement for Yahoo's ad sales services, according to the filing. If it does, Yahoo will then keep 93 percent of the search revenue generated on sites owned and operated by Yahoo, instead of 88 percent. But Yahoo can also decide to remain the exclusive premium ad sales provider, in which case it will settle for an 83 percent share of the revenue. If Microsoft doesn't end the exclusive arrangement, Yahoo's share of the revenue will go up to 90 percent."
Microsoft got a good deal (Score:3, Informative)
"Microsoft will pay Yahoo $50 million a year for three years and will hire at least 400 Yahoo employees as part of the companies' recent search agreement, according to a filing with the US Securities and Exchange Commission.
50 mil and those 400 employees' salaries are pocket money for Microsoft. They have paid a great many times more than that in various out-of-court settlements over the years.
Incidentally, another comment that springs to mind is that Yahoo must be quite desperate: $50M is nothing for a large intarweb company these days.
Microsoft and Yahoo joining efforts will probably produce nothing good at all though: they both have mediocre search businesses, and they'll end up with a mediocre shared search business. Nothing for the big G to worry about I reckon.