A Bad Deal For Yahoo?

Scott Lambert

COURT.jpgAfter some months of simmering just beneath the surface, tensions between Yahoo and Microsoft broke through into public view this week when a US court ruled that, according to the terms of their partnership, Yahoo must introduce Bing’s search systems in two Asian markets where it had been hesitant to do so.

The decision comes as industry experts are starting to comment on the fact that the partnership has worked out much better for Microsoft than for its smaller associate.

“We had a narrow disagreement regarding the Search Alliance rollout in Hong Kong and Taiwan. We have unwavering plans to continue investing in the Search Alliance, now operating in more than 20 countries, and the Bing platform, which is central to our latest products,” said a Microsoft spokesperson in a statement. It was stressed that Bing is a key component of Windows 8, so its absence could hurt Microsoft’s sales in other areas.

The tension in this case seems to hinge on the resignation of Microsoft’s Steve Ballmer, with Yahoo’s Marissa Mayer saying she had wanted to delay any action until a replacement for him had been found; however, Mayer has expressed unhappiness about the agreement before. Set to last until 2020, it was intended to help both parties gain ground on Google in the search market, but in fact Google’s share has barely changed since its inception.

What has happened is that Yahoo and Bing’s positions in the comScore rankings have switched, with the latter now around six points ahead of the former – previously it was the other way around. Bing has certainly made gains, but at Yahoo’s expense.

“We’re endeavoring to gain share. We’re designing new functionality, differentiating functionality. We’re doing direct display units that bring the content right to the user in search results,” Mayer has said of her attempts to turn Yahoo’s fortunes around. With recent improvements in its search design, especially on mobile, it does seem to be experiencing a slight upturn. Microsoft, meanwhile, is said to be nervous about stalling growth and a lack of opportunities to expand its operations with Bing. Despite the public spat, however, both companies have seen their share prices rise over the past week.

Throughout these goings-on the only clear winner has been Google; however, all three have seen a fall in popularity with the general public, potentially leaving room for innovative new competitors.

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Scott Lambert

Written by Scott Lambert

For 35 years, Scott has been at the forefront of digital transformation and how it is effectively applied in businesses and organizations to market, sell, and support customers and members more successfully and cost effectively. Scott is President and Co-Founder of Xcellimark, an award-winning digital marketing agency serving clients throughout the U.S., Canada, Central America, and Germany. Xcellimark helps businesses succeed through the implementation of its unique digital marketing and sales approach specifically designed to meet their specific goals and objectives. Scott’s marketing, sales, and operations experience have included key management positions at industry leaders including AT&T, iXL (now SapientRazorfish), eSchool Solutions (now TalentED), and BellSouth, where he led the product development, marketing efforts, and market launch of BellSouth.net, the second public ISP developed in the U.S. Scott is the author of articles highlighted on leading online publishers such as LinkedIn, Business 2 Community, and he was recently featured by LinkedIn in the Entrepreneur magazine article on “No Time for Marketing? Hire a Freelancer.” His engaging personality and wealth of real-world and business experience make Scott a frequently requested speaker. Some of his engagements include being the featured speaker in a series of Orlando Business Journal seminars on Digital Marketing, speaking at the WSI London conference, and at international conferences in Belize. Scott has a Bachelor’s degree in Accounting from the University of Mississippi and a Master’s of Science in the Management of Technology from the Georgia Institute of Technology (Georgia Tech). Scott has been active in global mission efforts and is a board member of Global Teams, a Christian outreach organization. He lives in Winter Springs, FL with his wife Nancy and dog Sadie.

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