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Yahoo CEO says search deal with Microsoft is not working

Wants more people to visit Yahoo's websites
Wed Feb 13 2013, 13:10

INTERNET PORTAL Yahoo's CEO Marissa Mayer has admitted the firm's internet search deal with Microsoft is not working.

Yahoo signed a 10-year deal with Microsoft to drive its internet search engine with Bing while Yahoo effectively acts as an advertising broker for Microsoft. However Mayer, speaking at the Goldman Sachs Technology and Internet Conference, said that the deal isn't working as planned, with the companies merely trading internet search market share between each other.

Mayer said, "One of the points of the alliance is that we collectively want to grow share rather than just trading share with each other." She added, "We need to see monetisation working better because we know that it can and we've seen other competitors in the space illustrate how well it can work."

Yahoo's deal with Microsoft came after a long saga that included Microsoft trying to buy Yahoo, only for its then CEO and founder Jerry Yang to rebuff what now seems to have been an offer of a lifetime for the firm. Yang departed as CEO only for his replacement, Scott Thompson to resign months into his job over inaccuracies in his resumé.

While Mayer said that the deal with Microsoft isn't working the way it should, it is hard to see how Yahoo will grow its internet search market share relative to Google if it doesn't control the search technology it offers. Meyer even commented that the firm's big goal is not search engine technology but getting people to visit its various websites.

"Our biggest business problem right now is [page] impressions," Mayer said, asking, "Basically can we grow impressions, can we get growth happening here?" The only problem is that she has so far talked in only very vague terms about how to increase visitors to Yahoo's websites, claiming that the future is in websites personalised to the user.

Since Yahoo signed the 10-year deal with Microsoft back in 2010, Mayer's legal team will have to go through the deal with a fine-toothed comb to see how the company can make changes it believes will give it a better chance against Google. µ


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