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    Microsoft and Yahoo set to announce search deal

Rumours suggest the pair are finally set to tie up on a search and advertising deal.

By Nicole Kobie, 29 Jul 2009 at 08:31

handshake

Microsoft and Yahoo are set to announce a search and advertising partnership later today.

Reports in the Wall Street Journal's All Things Digital blog as well as Reuters have cited multiple anonymous sources as saying the pair have finally come to an agreement.

According to the WSJ blog, the deal will see Microsoft run the search end, while Yahoo sells advertising on its own sites as well as some of Microsoft's.

Yahoo would get to keep the bulk of the revenue for the first three years, while Microsoft would buy its way to the number two spot in search - its stated goal when it launched it's own new search tool Bing.

A report from Reuters said Microsoft would not be paying anything upfront to Yahoo.

But analysts noted the deal would be subject to regulatory approval. A tie-up between Google and Yahoo was dropped last year over worries regulators wouldn't approve it.

Neither company is issuing comment on the deal, and such rumours have made headlines ever since Microsoft's failed £44 billion bid for Yahoo.

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