The search deal just announced by Microsoft and Yahoo! is great news for the internet.
Users, advertisers and publishers alike will all win. It can only lead to greater choice, better value, and more innovation.
The deal, under which Microsoft’s Bing will power search on both Microsoft and Yahoo! sites, will create a real alternative to Google, which is currently overwhelmingly dominant in search and search advertising, commanding some 90% of searches in Europe alone.
The Microsoft/Yahoo! deal will create the scale necessary to more effectively compete with Google’s super dominance. It will attract more users to the combined platform; and those users will enjoy more relevant ads and better search results. More users means more advertisers, and more advertisers means even more relevant ad results -- a self-reinforcing “virtuous” cycle where users and advertisers alike are big beneficiaries.
Similarly, web publishers will have an alternative to Google that has the necessary scale to be attractive for their search syndication deals. The new platform will be able to offer web publishers more competitive bids for their search syndication.
Finally, and importantly, “search” itself will also win in the form of greater innovation -- Bing is already a breakthrough in innovative features, but the additional push that the deal will give to development and refinement of the search algorithms and other drivers of the platform will deliver even more rapid advances. Searches will only become more relevant and useful.
Regards, Per
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