After a year of bad blood, Microsoft, Yahoo talking again

WSJ report says CEOs Balmer and Bartz are discussing search and ad deal

Nearly a year after Microsoft Corp.'s fractious takeover bid for Yahoo Inc. fell through, the two companies are reportedly talking business again.

The two companies aren't talking about a merger or buyout but may be talking about a plan for joint search efforts and ways to partner advertising projects, according to Kara Swisher, a blogger for The Wall Street Journal.

Microsoft and Yahoo haven't exactly been the best of friends since takeover talks were abandoned last May, but their mutual rival, Google Inc., may have brought them back together. Just this week, Hitwise, a company that measures online traffic, reported that Google accounted for slightly more than 72% of all online searches conducted in the U.S. during March. In the same time frame, Yahoo Search grabbed 16%, while Microsoft's MSN Search garnered only 5.5%.

"It's in the best interest of both companies to get a partnership together on search," said Dan Olds, principle analyst with the Gabriel Consulting Group. "Google owns about two-thirds of the search market now and isn't showing any signs of losing momentum. Yahoo and Microsoft need to pool their efforts in order to have any chance of blunting Google's rising market share.

And Olds also noted that since Yahoo CEO Carol Bartz wasn't at the helm of the online company during its 2008 struggle with Microsoft, tensions between the two firms may be easing.

"Microsoft's Steve Ballmer isn't shy about letting everyone know that he sees an agreement with Yahoo as a priority," Olds added. "Sort of the old 'the enemy of my enemy is my friend' sort of deal. With Bartz taking over the reins at Yahoo, this should take much of the personal animosity out of the relationship between the two companies and make a relationship much more possible. Both Balmer and Bartz must see the same reality -- Google is running away with the search market. It wouldn't be surprising to see that they will also agree that a joint attack on Google is their best course of action."

Swisher noted in her blog that a "variety of sources" said the talks between Yahoo and Microsoft are preliminary and are covering a wide range of topics. She added that the talks reportedly are not about launching another buyout bid.

Rumors also are swirling this week about Google and Microsoft prowling around after Twitter's search ad revenue potential. With Twitter working to upgrade its real-time search, the two companies may be looking for ways to make some money off of it.

Join the newsletter!

Or

Sign up to gain exclusive access to email subscriptions, event invitations, competitions, giveaways, and much more.

Membership is free, and your security and privacy remain protected. View our privacy policy before signing up.

Error: Please check your email address.

Tags MicrosoftYahoo

Keep up with the latest tech news, reviews and previews by subscribing to the Good Gear Guide newsletter.

Sharon Gaudin

Computerworld
Show Comments

Cool Tech

Toys for Boys

Family Friendly

Stocking Stuffer

SmartLens - Clip on Phone Camera Lens Set of 3

Learn more >

Christmas Gift Guide

Click for more ›

Brand Post

Most Popular Reviews

Latest Articles

Resources

PCW Evaluation Team

Aysha Strobbe

Microsoft Office 365/HP Spectre x360

Microsoft Office continues to make a student’s life that little bit easier by offering reliable, easy to use, time-saving functionality, while continuing to develop new features that further enhance what is already a formidable collection of applications

Michael Hargreaves

Microsoft Office 365/Dell XPS 15 2-in-1

I’d recommend a Dell XPS 15 2-in-1 and the new Windows 10 to anyone who needs to get serious work done (before you kick back on your couch with your favourite Netflix show.)

Maryellen Rose George

Brother PT-P750W

It’s useful for office tasks as well as pragmatic labelling of equipment and storage – just don’t get too excited and label everything in sight!

Cathy Giles

Brother MFC-L8900CDW

The Brother MFC-L8900CDW is an absolute stand out. I struggle to fault it.

Luke Hill

MSI GT75 TITAN

I need power and lots of it. As a Front End Web developer anything less just won’t cut it which is why the MSI GT75 is an outstanding laptop for me. It’s a sleek and futuristic looking, high quality, beast that has a touch of sci-fi flare about it.

Emily Tyson

MSI GE63 Raider

If you’re looking to invest in your next work horse laptop for work or home use, you can’t go wrong with the MSI GE63.

Featured Content

Product Launch Showcase

Don’t have an account? Sign up here

Don't have an account? Sign up now

Forgot password?