Google partners with Yahoo, Microsoft cut out of the gameplan
2008-06-13 15:41:57 (GMT) (Caymanmama.com - Technology News)San Francisco, California (CaymanMama.com) — It has been reported that the efforts of Yahoo Inc. to revive the negotiations with the Microsoft Corp. now have come to an end as the Yahoo has now agreed to hire Google for handling some advertising sales for it. After this news was disclosed on Thursday, the shares of Yahoo plunged 10% as the investors lost all hopes of Microsoft renewing the 5-month quest for buying Sunnyvale, a company based in California. Although a news of stock selling off is never a favorable one for a company, the disenchantment of Wall Street has arrived at such a bad time of the Yahoo and the board of its directors.
Yahoo is attempting to ward off the share-holders mutiny the leader of which is Carl Icahn, an activist, who has undertaken to replace the board of the company because he is not satisfied with the manner in which the directors negotiated with the Microsoft. The decision about the Yahoo board will be made on August 1 on which the annual shareholders meeting of the company has been scheduled. If Google partners with Yahoo, the later will be able to use the superior technology of its rival for displaying advertisements on its website in addition to its partners’ websites situated in Canada and United States. According to the Yahoo estimates, the arrangement can boost its revenues by $800 million approximately in the first year of their partnership.
The deal seems to be a victory for the Google as it never wanted Yahoo to be clutched by the Microsoft. The co-founder of the Google, Sergey Brin, said, “I am happy to be helping them to stay independent.” According to the experts, Google is already holding 75% of the market of search advertising while Yahoo is standing at a mere 9%. Microsoft wanted to slow down the growth of Google by joining together with Yahoo but the two companies could not agree to mutual terms.
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