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November 5, 2009

Microsoft Yahoo search deal could hit Europe

Ballmer says partnership could go international

Martyn Williams

Microsoft's deal with Yahoo under which the software maker's new Bing search engine will be used to power Yahoo searches and Yahoo will sell premium advertising for both companies could be expanded overseas, Microsoft CEO Steve Ballmer said on Thursday.

"It's possible we would extend that partnership outside of the US but we'll have to wait and see until we actually are able to get approval and consummate our partnership with Yahoo inside the US and perhaps there'll be news on that some other day," he told a Tokyo news conference after being asked if a similar deal would happen in Japan.

The 10-year search plan was originally announced in July with hopes of hammering out a deal by October 27 but the companies missed the deadline. A day later they said talks will be extended for an unspecified period.

The deal also faces scrutiny from the US Department of Justice, which has begun studying if the broader competitive landscape would be impacted by the proposed search engine tie-up.

Both Microsoft and Yahoo trail in the search market behind Google, which enjoyed a 71-percent market share in the US in October, according to data from Hitwise. Yahoo had a 16 percent share and Microsoft's Bing was third with just under 10 percent of the search market.

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