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New details about the Yahoo-Microsoft deal have emerged, including news that Microsoft will hire 400 departing Yahoo employees.  (Source: G. Yonis)
New details have emerged on the terms of Microsoft's deal with Yahoo

At long last Microsoft and Yahoo are united.  While staying separate corporate entities, Yahoo's search algorithm with be replaced by Microsoft's fancy new Bing search engine and Yahoo's staff will be put to work selling Microsoft's new advertising platform. 

The government's approval will make or break the deal, which search market leader Google indicated it may fight on antitrust grounds.  As the companies began filing the first of their documents pertaining to the deal with the U.S. Securities and Exchange Commission -- a form 8-K filing from Yahoo -- new specifics have come to light about exactly what it took to reach a deal.

According to the filing Microsoft will pay Yahoo $50M USD this year to cover "transition and implementation costs".  It will also hire 400 Yahoo employees.  However, it will in return receive 12 percent of Yahoo's advertising revenue from searches.  In five years a variety of options are on the table for both companies that could raise Microsoft's cut to as much as 17 percent or drop it to as little as 7 percent.

The companies hope to have the deal finalized by July 29, 2010.  If they fail to meet this date, either company can terminate the deal, but they also have the option of a six month extension to hammer out a finalized partnership. 

Microsoft at one time offered Yahoo $44.6B USD for a full acquisition, and reportedly offered considerably more behind close doors.  Ultimately Yahoo rejected the offer, and in following months shareholders saw their stock price drop and thousands of Yahoo employees were laid off.  In the end, though, with new members on the board, a new CEO -- Carol Bartz -- Yahoo managed to work out its differences with Microsoft.

If approved, the pair will hold approximately 30 percent of the search market.  Google owns approximately two thirds of the market.

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By creathir on 8/6/2009 2:59:43 AM , Rating: 5
I am curious on what ground Google thinks it posisbly has standing of taking on an antitrust case against Yahoo/Microsoft?

When someone controls 2/3+ of the market, how can they possibly argue that the other two forming up 3/7+ of the market would be anticompetitive towards them?

Google needs to grow a pair.

- Creathir

RE: Antitrust?
By Kuroyama on 8/6/2009 10:13:46 AM , Rating: 5
2/3 + 3/7 > 100%

RE: Antitrust?
By nerdye on 8/6/2009 1:59:38 PM , Rating: 2
2/3 + 3/7 > 100%

voted +1, that fricken killed me inside =)

RE: Antitrust?
By creathir on 8/7/2009 9:43:35 AM , Rating: 2
Heh, yes, it would be.

I meant to write 3/10. Sorry 'bout that.

++ for MS
By nafhan on 8/6/2009 9:34:04 AM , Rating: 3
Is anyone else amazed by how well this turned out for MS? They basically got almost everything they would have gotten out of the merger, but for way way less money.

Why kill instantly...
By quiksilvr on 8/6/2009 2:20:03 AM , Rating: 2
When you can let it suffer and slowly trickle away the company's life.

MS & Yahoo Relationship
By WoWCow on 8/6/2009 10:38:07 AM , Rating: 2
Summing this up, MS has always been the old cougar prowling on Yahoo's wimpy ass in this relationship.

During the original buyout scheme (Beginning Jan. 31):

MS: Darling, I'm gonna buy you everything and give you the world!
Y!: Nooo!! this is going too fast and you're coming on too strong! I'm sorry, but I cannot reciprocate your feelings.

The two breaks up, and initiates a 3 months learning process about each other. (May 6)

MS: I am still hoping we can get it done.
Y!: I agree, but please let me collect myself before we continue.

After that, they both agrees they can work out their difference and have a successful marriage with the blessing of Father government. (August)

Y!: I'm sorry, I just wasn't ready 3 months ago.
MS: Its ok, I can forgive and forget just don't cheat on me with your ex (google)!

Sounds like Ballmer and Bill Gates being the Mom and Dad that created MS

The companies hope to have the deal finalized by July 29, 2010. If they fail to meet this date, either company can terminate the deal, but they also have the option of a six month extension to hammer out a finalized partnership.

As a gesture of commitment towards that sacred date, MS takes 400 of Y!'s kids and decides to raise them as his/her own while preparing to give birth to their son named Bing a year from now.

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