Lucky Day
Daywatch
Strange conclusion to the Microsoft/Yahoo! "deal"
Last year, as you might know, MS got interested in the founding search engine and made an offer. Yahoo thought this could be a nice little trip to the bank and began negotiations. MS, as you might know, doesn't do business that way and walked away.
Yahoo! then fired their CEO and and brought in Carol Bartz who said any offer would require "a boatload of cash".
Well there was no cash in the "deal" and it looks like Yahoo is actually out of the search business! They are outsourcing their search business to Bing. All they will be is front end to their engine and collecting 88% of the revenue from it for the next 5-10 years.
So, effectively, MS has acquired Yahoo at the cost of them paying MS 12% of their ad revenue a year with no cash upfront.
Last year, as you might know, MS got interested in the founding search engine and made an offer. Yahoo thought this could be a nice little trip to the bank and began negotiations. MS, as you might know, doesn't do business that way and walked away.
Yahoo! then fired their CEO and and brought in Carol Bartz who said any offer would require "a boatload of cash".
Well there was no cash in the "deal" and it looks like Yahoo is actually out of the search business! They are outsourcing their search business to Bing. All they will be is front end to their engine and collecting 88% of the revenue from it for the next 5-10 years.
So, effectively, MS has acquired Yahoo at the cost of them paying MS 12% of their ad revenue a year with no cash upfront.