GOOGLE AND YAHOO TO SHARE WEB ADS !
Yahoo says the experiment may not lead to a "lasting relationship". Yahoo and Google, the world's two biggest search engines, have announced a two week experiment that will see them share advertising space.
During the pilot, Google will be able to place ads alongside 3% of search results on Yahoo's website.
Analysts say the move is designed to frustrate Microsoft, which has offered to buy Yahoo for $44.6bn (£22.6bn), or extract a higher offer.
Microsoft said any lasting deal would not be in the consumers' interests.
"Any definitive agreement between Yahoo and Google would consolidate over 90% of the search advertising market in Google's hands. This would make the market far less competitive," Brad Smith, Microsoft's General Counsel said.
But Yahoo said the testing did not necessarily mean that "any further commercial relationship with Google will result".
Investors reacted positively to the announcement with Yahoo shares rising 7%.
"Yahoo has made a really clever move here," Cowen and Co analyst Jim Friedland said.
"It looked like Microsoft had all the cards, Yahoo is at least now able to use this for leverage to get Microsoft to pay more," he said.
Microsoft chief executive Steve Ballmer on Saturday gave Yahoo three weeks to agree to the company's offer or risk having the offer lowered.
During the pilot, Google will be able to place ads alongside 3% of search results on Yahoo's website.
Analysts say the move is designed to frustrate Microsoft, which has offered to buy Yahoo for $44.6bn (£22.6bn), or extract a higher offer.
Microsoft said any lasting deal would not be in the consumers' interests.
"Any definitive agreement between Yahoo and Google would consolidate over 90% of the search advertising market in Google's hands. This would make the market far less competitive," Brad Smith, Microsoft's General Counsel said.
But Yahoo said the testing did not necessarily mean that "any further commercial relationship with Google will result".
Investors reacted positively to the announcement with Yahoo shares rising 7%.
"Yahoo has made a really clever move here," Cowen and Co analyst Jim Friedland said.
"It looked like Microsoft had all the cards, Yahoo is at least now able to use this for leverage to get Microsoft to pay more," he said.
Microsoft chief executive Steve Ballmer on Saturday gave Yahoo three weeks to agree to the company's offer or risk having the offer lowered.
BBC NEWS REPORT.
Labels: Web Yahoo Google Shares Microsoft Advertising Experiment Market
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