Yahoo Strikes Deal With MSN, Loses Its Identity

Today Yahoo finally made its deal with Microsoft public.’a0 Under the new agreement, Microsoft will now power all Yahoo searches and Yahoo will become the sales force of the two firms’ advertising customers.’a0 Additionally, Yahoo will continue to focus on building customer-facing portals and Internet destination sites.

So, in effect, Yahoo has abandoned any type of unique identity it once had as all the capital and manpower invested in its search assets are down the drain.’a0 You see, in the three horse race of desktop search, Google was number one, Yahoo was a second place with about 20% of the search market, and Microsoft was third place.’a0 Now, Microsoft has secured the second place and will now be in a better position to challenge to Google in the lucrative desktop search market.

Yahoo was once a mighty giant in the Internet space.’a0 It even commanded the number one spot in search for many years.’a0 Then, abandoning its search technology, Yahoo adopted Google as their search provider.’a0 in more recent years, Yahoo abandoned its deal with Google and went pack to powering their search queries on Yahoo.com.

Now, with search results provided by Bing, Yahoo has gutted themselves of any identity as a provider of any valid services.’a0 With today’s announcement and its deal with Microsoft, Yahoo has admitted defeat to Google in the search market.

Who’s the big winner in today’s deal?’a0 Microsoft, obviously.’a0 They’ve now entered in to an agreement whereby Bing has asserted itself as a force against Google’s search dominance.

Unfortunately for Yahoo, they waited too long for this deal to be sweet for them.’a0 Over the winter, they tried to hold out for a high share price to be taken over by Microsoft.’a0 In the meantime, Flickr’s founders have left and so have the founders of Del.icio.us, Yahoo’s other exciting Web 2.0 acquisition of the recent past.

So, as a result, Yahoo has lost its sexiness as a provider of innovative web 2.0 services and their highly sought after search assets as well.’a0 Hopefully Yahoo has something up its sleeve, otherwise Microsoft stands out as the clear winner in this deal between the web giants.