Partner Marketer

You probably did not miss the news that Microsoft tried to buy Yahoo this spring. It didn’t work out because Yahoo didn’t feel like getting bought.

But the most interesting piece of information coming out of the negotiations was this: Yahoo Search Marketing and Yahoo Publisher Network are two divisions that are now hanging very loose internally within Yahoo. Why? Yahoo decided to test outsourcing the search monetization to Google giving them approximately 3% of their inventory.

The test was hugely successful according to leaked reports in the press.

This means that Yahoo would make MORE money by outsourcing all of their search monetization to Google and scale back internal staff even after giving Google 10-15% of the gross.

Why is this? In order of importance:

1. Google has more advertisers.
2. Google has better targeting technology.
3. Google has a better system in place to get minimum bids out of their advertisers.

It’s not unlikely that YSM, YPN or both won’t be around much longer… an ad deal between Yahoo and Google could come any week now.

Hats off to Google of course for doing a great job making money.

But isn’t it sad that Google Adwords could be pretty much the only game in town for search marketing this fall?

-Ola