What Happened
Earlier today, Yahoo announced it has reached a non-exclusive deal with Google to display the latter’s search results and ads in its own services, both on mobile and desktop devices. Yahoo has a similar arrangement with Microsoft’s Bing in place, but it states that the new Google partnership will only be supplementary to its existing deal with Bing. Yahoo will have near total control over when or where to pull in Google’s search results or ads, but it remains unclear whether advertisers would have the option to opt out of having their Google search ads shown on Yahoo sites.
Market Impact
According to a comScore report released in August, Google dominated the U.S. desktop search market with nearly 64% market share, whereas Yahoo’s search network trailed far behind with only 12.7% market share. Therefore, it makes sense for Yahoo to team up with the biggest search engine on the planet in order to leverage some of Google’s search technologies and ad products to better manage search queries and serve ads. For Google, this deal helps to further expand the reach of its search ads, which in turn increases its revenue. Overall, the search market now faces the challenge of losing search to apps on mobile devices, and we expect to see more consolidating partnerships like this as search giants continue to battle with this issue.
Source: Business Insider