socialmedian: Yahoo-Microsoft Talks Now Hot and Heavy

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Source: Silicon Alley Insider

Apr 21, 2009

Summary

Yahoo and Microsoft are finally talking seriously about a search-ad partnership, Kara Swisher says. We won't likely get details on today's Yahoo earnings call, but the parties could finally be getting closer to a deal.

As has been the case since Carol Bartz took over Yahoo, Microsoft is pushing the talks and Yahoo is playing hard to get. This is as it should be: With only 8% of the US search market, Microsoft must do this deal if it wants to have any chance to build a meaningful search business. Yahoo, which has 20%, would benefit from the deal, but for now it's holding its own.

The key issue in the talks appears to be the percentage of the payout Yahoo would get on each search term originated on Yahoo, as well as the size of the upfront payment Microsoft would make to Yahoo to buy its search engineering business.

Here's Kara:

Microsoft executives–including a key M&A and strategy exec, Charles Songhurst, and digital head Qi Lu–have been in Silicon Valley recently in talks with Yahoo execs.

Li, who used to work at Yahoo as a top tech exec in search before moving

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